In this question we will look at one of the automatic stabilizers, unemployment insurance. Using the FRED economic database (https://fred.stlouisfed.org/), search for unemployment insurance. You should find a series like “Personal current transfer receipts: Government social benefits to persons: Unemployment insurance.” Graph the annual series.

a. How much did the government spend on unemployment insurance at the peak of spending around the 2008–2009 recession?

b. Approximately how much was spent on unemployment insurance in 2007, before the recession began? Compare your answer from part a to your answer from part b.

The graph shows unemployment insurance spending in billions of dollars. In order to compare this spending to that in previous periods and to evaluate unemployment insurance spending as a fiscal stimulus, we should graph spending as percentage of GDP. Click Edit Graph, and under Customize Data, search for Gross Domestic Product. (Do not click Real Gross Domestic Product, since we will compare with nominal insurance spending.) Add that data series. Then, under Customize Data, use the formula a/b*100 and click Apply.

c. As a percentage of GDP how much was spent around the peak of the 2008–2009 recession?

d. In the historical series, when was the most spent on unemployment insurance as a percentage of GDP?