Bertelsmann Stiftung (ed.)

An Unemployment Re-Insurance Scheme for the Eurozone? Stabilizing and Redistributive Effects

Summary of the study

  • 2018, 8 pp (PDF)
  • Free of charge

In October, the German Federal Ministry of Finance (BMF) outlined one such re-insurance scheme. The basic idea behind the BMF proposal is to grant loans to national unemployment insurance systems in times of severe economic crisis in order to avoid aggravating (i.e., "procyclical") cuts in payments (benefits) to the unemployed or increases in contributions while the crisis lasts. This would create a re-insurance system for national unemployment insurance schemes designed to strengthen their role as "automatic stabilizers" and making the eurozone more resilient in times of crisis.