Jonas Kolsrud

PhD, economist and researcher, Swedish National Institute of Economic Research, Stockholm, and Swedish Institute of Social Research (SOFI), Stockholm University
Phone: +46 - 8 - 453 59 35 or +46 704 357 354
Email: jonas.kolsrud[at], jonas[at] or jonas.kolsrud[at]

My primary research interests are public finance and consumption smoothing, especially how publicly provided income insurance schemes affect consumption/saving behavior and defining welfare effects of public insurance programs. 

I'm also working on issues on spatial job search strategies - how unemployed individuals trade-off commuting time against wage when searching for work - consumption and wealth inequality and active labor market programs.


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

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

(with Camille Landais (LSE), Peter Nilsson (IIES) and Johannes Spinnewijn (LSE))

This paper provides a simple, yet robust framework to evaluate the time profile of benefits paid during an unemployment spell. We derive sufficient-statistics formulae capturing the marginal insurance value and incentive costs of unemployment benefits paid at different times during a spell. Our approach allows us to revisit separate arguments for inclining or declining profiles put forward in the theoretical literature and to identify welfare-improving changes in the benefit profile that account for all relevant arguments jointly. For the empirical implementation, we use administrative data on unemployment, linked to data on consumption, income and wealth in Sweden. First, we exploit duration-dependent kinks in the replacement rate and find that, if anything, the moral hazard cost of benefits is larger when paid earlier in the spell. Second, we find that the drop in consumption affecting the insurance value of benefits is large from the start of the spell, but further increases throughout the spell. In trading of insurance and incentives, our analysis suggests that the at benefit profile in Sweden has been too generous overall. However, both from the insurance and the incentives side, we find no evidence to support the recent introduction of a declining tilt in the profile.

Link to paper

Working Papers

Studying Consumption Patterns using Registry Data: Lessons From Swedish Administrative Data (2017)

(with Camille Landais (LSE) and Johannes Spinnewijn (LSE))

(Revise & Resubmit, Journal of Public Economics)

This paper measures consumption expenditures using registry data on income and asset holdings in Sweden and illustrates how a registry-based measure can alleviate some critical limitations of traditional survey measures in capturing changes in consumption inequality and consumption responses to shocks. In the construction of our measure, we build on previous work exploiting the identity coming from the household budget constraint between consumption expenditures and income net of savings. We try to improve this measure using more registry information to account for the contribution of both financial and real assets to consumption flows. We demonstrate the power of the registry-based measure to study the relationship between income and consumption inequality, especially at the top of the income distribution. We also exploit the longitudinal dimension to study consumption responses to important life-time events and the different means used to smooth consumption.

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

Jonas Kolsrud,
Nov 9, 2017, 5:34 AM