As part of its pandemic policy response, the U.S. government implemented the largest increase in unemployment insurance (UI) benefits in history. How did this unprecedented increase in unemployment benefits affect labor markets and household spending? This paper uses administrative bank account data covering millions of households, several causal research designs, and a dynamic structural model to estimate and interpret the responses to these supplements. We find that, gauged in several different ways, these increases in benefits had large effects on spending but small effects on job-finding, implying that the increased benefits provided households with financial relief without being a significant drag on the economic recovery.


Fiona Greig

Former Co-President

Daniel M. Sullivan

Consumer Research Director, JPMorganChase Institute

Peter Ganong

Assistant Professor at the University of Chicago Harris School of Public Policy

Pascal Noel

Neubauer Family Assistant Professor of Finance at the University of Chicago Booth School of Business

Joseph Vavra

JPMorgan Chase Institute Academic Fellow