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Three essays on unemployment and the labor market

Lachapelle, Nathan
(2025)

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Authors
  • Lachapelle, NathanUCLouvain
    author
Supervisors
Dejemeppe, Muriel
Abstract
This thesis contributes to the analysis of labor markets in two key ways. First, in chapter 1, we study the local and aggregate effects of wage rigidities in Belgium. To achieve this, we develop and quantify a spatial equilibrium model that incorporates wage-constrained labor markets, unemployment, commuting, and migration. We simulate the economy under different labor mobility assumptions to calculate the impact of removing wage rigidities. Our findings show that when workers can only change their workplace, welfare increases by 0.5% to 2% across municipalities. However, when workers are also allowed to change their residence, the welfare effects become more equalized at approximately 1%. Second, in chapters 2 and 3 we study the causal effects of unemployment insurance (UI) benefits generosity on labor market outcomes for low-wage workers in charge of a family. In chapter 2, we investigate a reform of the Belgian UI system that replaced a flat UI benefits profile with a declining. Using a difference-in-differences strategy, we find no evidence that changes in UI benefits have had an impact on the employment prospects of lone parents. For household heads cohabitating with another adult, our results are in line with the predictions of standard job search theory. In the third chapter, I leverage the floor amount of UI benefits in Belgium, which creates a kink in the relationship between UI benefits and past earnings. Using a regression kink design, I estimate that providing an extra euro of benefits has small negative effects on men, as in standard job search theory. In contrast, for women, this additional euro per day unexpectedly increases the number of days worked and decreases the time spent in insured unemployment.
Affiliations
  • Institution iconUCLouvainSSH/LIDAM/IRES - Institut de recherches économiques et sociales

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Lachapelle, N. (2025). Three essays on unemployment and the labor market. https://hdl.handle.net/2078.5/241410