The moral hazard problem associated with unemployment insurance (UI)results in:

Question

Quizplus · Accepted Answer

The moral hazard problem associated with UI occurs when workers become less incentivized to actively search for employment because they know they have a safety net in the form of UI benefits. This leads to an increase in the average duration of unemployment, as workers may take longer to find a job. It does not necessarily result in a reduction in the number of workers who are eligible for UI, an increase in the average amount of weekly benefits, or a reduction in the number of firms participating in the program.

The Moral Hazard Problem Associated with Unemployment Insurance (UI)results In