Who Helps the Unemployed?

Workers' Receipt of Public and Private Transfers

Published in: IZA Journal of Labor Economics, Volume 9, Issue 1 (2020). doi: 10.2478/izajole-2020-0004

Posted on RAND.org on September 17, 2020

by Kathryn A. Edwards

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I use longitudinal data from the Panel Study of Income Dynamics (PSID) to measure the extent to which an unemployment spell increases the likelihood that a worker receives a cash transfer from family. I examine the prevalence of cash transfers from family, the demographic distribution of unemployed receivers, and the variation between family supported and not family supported spells. I further investigate how this informal, private assistance relates to public transfers from Unemployment Insurance using state-by-year variation in the UI program. I find that unemployment increases the probability a worker receives financial assistance from their family, inclusive of all demographic subgroups, that family cash transfer receipt is growing over time, and is weakly related to UI availability.

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