Jonas Kolsrud

PhD, economist and researcher, National Institute of Economic Research, Stockholm, and Swedish Institute of Social Research (SOFI), Stockholm University

Phone: +46 - 8 - 453 59 32

Email: jonas.kolsrud[at] / jonas[at] / jonas.kolsrud[at]

My primary research interests are consumption and saving and how the two are affected by public social insurance programs. I am also doing work on unemployment insurance, job search and subsidized jobs programs.

Click here for my CV

Working papers

Retirement consumption and pension design

(with Camille Landais, Daniel Reck and Johannes Spinnewijn)

This paper develops and implements a framework that leverages consumption data to evaluate the welfare effects of pension reforms. Several countries have reformed their pension profiles to incentivize later retirement. Using administrative data in Sweden, we find that such pension reforms entail substantial redistributive costs. On average, individuals retiring later have higher consumption levels than those retiring earlier, implying that recent pension reforms redistributed from low- to high-consumption households. We show that the differences in retirement consumption are mostly driven by differential changes in consumption around retirement, and also that the marginal propensities to consume are lower for later retirees. Accounting for selection on health and life expectancy further increases the redistributive cost of recent reforms. While the overall gradient is clear, we also document a striking non-monotonicity in consumption levels between the early and normal retirement age, implying that the redistributive cost of incentivizing later retirement is the lowest in that age range. We find similar patterns in consumption data from other countries, including the non-monotonicity, suggesting that our findings are not unique to Sweden.

Link to paper

Business-cycle effects on precautionary saving estimates: Evidence from Swedish administrative data (2019)

Precautionary saving behavior is a cornerstone of many structural models, yet empirical evidence is inconclusive. Estimates of the size of precautionary wealth range between 0-50% of total wealth while Euler equation regressions have estimated relative risk aversion below conventionally assumed levels. The paper shows theoretically and empirically that (i) saving is non-linear function of income or consumption growth variance, and (ii) that the relationship between saving and income or consumption variance is highly dependent on the business cycle. Accounting for non-linearities and removing business cycle effects show that linear models underestimates precautionary wealth with at least 30% and that the coefficient of relative risk aversion is estimated to 1. The paper uses Swedish registry data on income and wealth and a residual measure of consumption to estimate Euler equations. The results are robust to asset risk, habit persistence and credit constraints. A heterogeneity analysis shows that increased income risk leads to a rebalancing to less risky assets, and that groups who face higher income variance change their net worth less when income risk rises.

Link to paper

Precaution and Risk Aversion: Decomposing the Effect of Unemployment Benefits on Saving (2013)

Reduced form estimations of precautionary saving with respect to labor market risk typically do not consider that a decrease of say unemployment probability or an increase in unemployment insurance (UI) generosity affects saving not only by reducing the expected variance in earnings but also by (in some cases) raising expected earnings. This paper studies the possibility of decomposing the treatment effect of UI on asset accumulation into two parts; one part where more generous UI leads to raised expected earnings and a second part where a more generous UI reduces the expected variation in earnings. The decomposition is applied to rich Swedish register data on both financial assets and debt. UI's effect on assets is identified with a kinked policy rule in the UI scheme. First, increased UI generosity has a significant effect, both economically and statistically, on asset holdings; a one percentage point increase in UI benefits decrease net financial asset holdings by 1 percentage point. Second, decomposing the total effect UI has on asset accumulation shows that raised expected earnings increase savings while a decreased variation in earnings decrease saving. Not accounting for the effect on expected earnings on saving underestimates the impact UI has on precautionary saving by 70 percent.

Link to paper

Consumption Smoothing during Unemployment (2011)

A vast literature has investigated how unemployment insurance (UI) affects labor supply. However, the distorting effect of UI on labor supply is to a large extent determined by how well UI benefits smooth private consumption, which in turn depends on the resources available to the unemployed. To determine UI's consumption-smoothing effect, I exploit a kink in the deterministic relationship between previous earnings and unemployment benefits. The randomized assignment of benefits created by the kink allows me to identify how UI affect the use of private wealth to finance consumption during unemployment spells. Using Swedish data for 2000-2002 I find that a large share of the unemployed actually can consume at the same level as they did prior to the layoff. I also find that loans are of great importance to consumption smoothing as more than half the sample lacks buffer savings. This is further emphasized for different subpopulations. Women, couples, and older individuals hold significantly larger liquid wealth than men and young singles.

Link to paper


The Value of Registry Data for Consumption Analysis: An Application to Health Shocks (2020)

(with Camille Landais and Johannes Spinnewijn)

Journal of Public Economics, 189

Link to paper

Link to Vox column

The Optimal Timing of Unemployment Benefits: Theory and Evidence from Sweden (2018)

American Economic Review, 108(4-5), 985-1033.

(with Camille Landais, Peter Nilsson and Johannes Spinnewijn)

Link to paper

Voluntary unemployment insurance as an option for non-standard work – the case of Sweden, OECD (2018)

Link to paper