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The Impact of Unemployment Insurance on Innovation

Two people in carpentry clothes look at a laptop in a shop. A colleague in the background has earmuffs on.

This project examines the extent to which Unemployment Insurance (UI) benefit generosity affects claimants’ future patenting behavior in California.


Inventing and patenting can be a financially risky activity, as it is often unpredictable whether investments in research will produce new discoveries. Despite this inherent uncertainty, there is relatively little evidence about how financial constraints affect new patenting behavior. For example, would individuals take more chances on inventive activity if social safety-net programs, such as Unemployment Insurance, provided an increased financial cushion? Understanding this dynamic is key for future innovation policy.

Research Project

This project studies the causal effect of Unemployment Insurance (UI) benefit generosity on UI beneficiaries’ future patenting activity. It connects patent records to administrative UI claims data to descriptively understand patenting activity in California. It also uses a regression kink design to obtain credible causal estimates of how a larger weekly UI benefit amount affects future patenting outcomes.

Research Team

Dr. Alex Bell (Co-Principal Investigator), Sreeraahul Kancherla (Co-Principal Investigator), Dr. Shogher Ohannessian



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