Economists and politicians have long debated the extent to which unemployment benefits affect the duration of unemployment. The table on the following page represents unemployment and unemployment benefit data for five high-income countries. The unemployment rate and the duration of unemployment benefits for each of these countries are shown for 2007, prior to the recession of 2008–2009, for 2010, the first full year following the end of the recession, and for June 2017, eight years after the end of the recession. As the data shows, three of these countries extended the duration of unemployment benefits as a result of the recession and two of those countries have since reduced the extended duration. The data for 2007, 2010, and 2017 show a positive relationship between the duration of unemployment benefits and the unemployment rate. Discuss whether you believe the length of time in which a person can receive unemployment benefits directly affects the unemployment rate, and whether your answer applies to 2007, 2010, and 2017. Look up the unemployment rates in each of the five countries. Discuss whether a positive relationship still exists between the duration of unemployment benefits and the unemployment rate, and whether you believe the extension of unemployment benefits in three of those countries played a role in their current unemployment rates.

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Country Canada France Great Britain Japan United States 2007 Unemployment Rate 6.4% 8.7% 5.3% 3.9% 4.6% Unemployment 2010 Benefits Duration, Unemployment 2007 Rate 50 weeks 52 weeks 26 weeks 13 weeks 26 weeks 7.1% 9.4% 7.9% 4.7% 9.6% Unemployment June 2017 Benefits Duration, Unemployment Rate 2010 50 weeks 104 weeks 26 weeks 21 weeks 99 weeks 6.5% 9.4% 4.3% 2.8% 4.4% Unemployment Benefits Duration, 2017 45 weeks 104 weeks 26 weeks 13 weeks 26 weeks