Benefits Quote by Paul Krugman
“Generous unemployment benefits can increase both structural and frictional unemployment. So government policies intended to help workers can have the undesirable side effect of raising the natural rate of unemployment.”
About This Quote
Source Article: "The Natural Rate of Unemployment", The New York Times, 2021
Generous benefits may raise both structural and frictional unemployment, increasing the natural unemployment rate.
In simple terms: High benefits can boost unemployment types.
Design incentives that encourage work.
Themes
Mood
Type
When to use this quote
- employment incentives
- government budgeting
Key Concepts
Questions to Reflect On
- How to balance support and work incentives?
- What alternatives reduce unemployment?
Benefits can also improve welfare.