Segmentation of unemployment benefits : cross-national variation and theoretical hypotheses

This paper measures segmentation of unemployment benefits across 28 OECD member states and sets out some hypotheses for explaining this cross-national variation. Segmentation of unemployment compensation can be defined as the division of public financial support for the unemployed into various benefits and the differences in generosity between these benefits. The paper argues that although this feature of national unemployment compensation systems is becoming increasingly important in post-industrial labour markets so far it has not received sufficient scholarly attention. For mapping the cross-national variation of this characteristic the paper deals with four as-pects: first, the various benefits available in each country, second, the differences in replace-ment rates between these benefits, third, the eligibility requirements of the more generous benefits, fourth, the beneficiary rates of the various benefits. With respect to explanatory hy-potheses three main theoretical schools are considered: The predictions of power resource theory are ambiguous and may have to be differentiated according to different historical phases. The Varieties of Capitalism approach would focus on segmentation arising from cer-tain skill structures in the labour market. State-centred institutionalism would see state auton-omy as impeding high segmentation of unemployment benefits. Lastly, the paper gives a brief outlook on future research.