Changes in economic policies will frequently have an impact on the unemployment rate. Explain whether each of the policy changes described is likely to: (1) affect frictional or structural unemployment and (2) increase or decrease the measured unemployment rate.

a. The government reduces the number of weeks of unemployment insurance that unemployed workers can receive.
b. The government raises the minimum wage.
c. The government increases spending on job-training programs.

Question

Changes in economic policies will frequently have an impact on the unemployment rate. Explain whether each of the policy changes described is likely to: (1) affect frictional or structural unemployment and (2) increase or decrease the measured unemployment rate.

a. The government reduces the number of weeks of unemployment insurance that unemployed workers can receive.
b. The government raises the minimum wage.
c. The government increases spending on job-training programs.

Quizplus · Accepted Answer

The Answer of Changes in economic policies will frequently have an impact on the unemployment rate. Explain whether each of the policy changes described is likely to: (1) affect frictional or structural unemployment and (2) increase or decrease the measured unemployment rate.

a. The government reduces the number of weeks of unemployment insurance that unemployed workers can receive.
b. The government raises the minimum wage.
c. The government increases spending on job-training programs.

Changes in Economic Policies Will Frequently Have an Impact on the Unemployment