Description: Department of Economics

Description: Johannes Spinnewijn

| LSE Economics |

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| Publications |

| Working Papers|

| In Progress|

| Teaching|

| Miscellaneous|

Johannes Spinnewijn

Position: Lecturer (Assistant Professor) in Economics

Research Interests: Public Economics, Behavioral Economics, Applied Theory

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Working Papers

  • The Optimal Timing of Unemployment Benefits: Theory and Evidence from Sweden - Slides // Draft Coming Soon - (with Jonas Kolsrud, Camille Landais and Peter Nilsson)

    Abstract: This paper provides a general framework to analyze the optimal time profile of benefits during the unemployment spell. We derive simple sufficient-statistics formula capturing the insurance value and incentive costs of unemployment benefits at different times during unemployment. Our general approach allows to evaluate the separate arguments for increasing or decreasing profiles put forward in the theoretical literature. Using administrative data in Sweden on unemployment, income and wealth, we find that the insurance value is fairly constant over the unemployment spell. From the start of the spell savings and credit play only a limited role in smoothing the loss of earnings. We also exploit duration-dependent kinks in the replacement rate and find that the welfare-relevant unemployment elasticity is twice as high for benefits in the first 20 weeks of the spell compared to benefits given after 20 weeks. Our evidence therefore indicates that the recent change from a flat to a declining benefit profile in Sweden has decreased welfare. The local welfare gains push towards an increasing rather than decreasing benefit profile over the spell.

  • Heterogeneity, Demand for Insurance and Adverse Selection - R&R at American Economic Journal: Economic Policy - (Web Appendix)

    Abstract: Recent empirical work finds that surprisingly little variation in the demand for insurance is explained by heterogeneity in risks. I distinguish between risk preferences and demand frictions underlying the residual variation. Demand frictions induce a systematic difference between the true and revealed value of insurance. Using a sufficient statistics approach that accounts for this alternative source of heterogeneity, I find that the welfare conclusions regarding adversely selected markets are substantially different. The source of heterogeneity is also essential for the evaluation of policy interventions intended to reduce adverse selection like insurance subsidies and mandates, risk-adjusted pricing and information policies.

  • Rewarding Schooling Success and Perceived Returns to Education: Evidence from India - REVISED - (with Sandra Sequeira and Guo Xu)

    Abstract: This paper tests two specific mechanisms through which individuals may form expectations about returns to investments in education: receiving recognition for one's schooling performance, and exposure to successful students through family or social networks. Using a regression discontinuity design, we study the impact of a fellowship program recognizing the schooling performance of young girls in secondary school in India. We find that the fellowship award is associated with a significant increase in the perceived value of education, by both increasing the perceived mean of earnings and decreasing the perceived variance in earnings associated with additional years of schooling. Being exposed to successful students does not affect perceived returns to education for those in their family or social networks. This exposure is however associated with holding more information on potential sources of funding for schooling and a higher intention to apply for the fellowship.

In Progress

  • Information Frictions and the Welfare Cost of Adverse Selection (with Ben Handel and Jon Kolstad)

  • The Perceptions of Employment Prospects during the Unemployment Spell (with Andreas Mueller)

  • Identifying Preference and Risk Heterogeneity in Insurance Markets: Theory and Evidence (with Keith Ericson, Philipp Kircher and Amanda Starc)

Current Courses Taught

  • Public Economics (PhD, LSE course, ec534)
  • Public Economics (MSc, LSE course, ec426)
  • Contract Economics (BSc, LSE course, ec301)
  • Introductory Microeconomics (Summer, LSE course, ec101)

Press Coverage/Other Writings

  • "Hard cash or a secure job - which is better?" featured in Financial Times (February 7, 2009) (link)
  • "The Role of Commitment" comment on "On the interaction between subsidiarity and interpersonal solidarity" by Jacques Dreze (link)
  • "En als we langdurig werklozen meer zouden betalen?" Op-ed in De Morgen (February 12, 2012) (link)
  • "De ivoren toren van economen is een mythe" Op-ed in De Standaard (August 3, 2013) (link)
  • "De mythe van de hangmat" Op-ed in De Standaard (May 15, 2014) (link)

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