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Fiscal Policy and Recessions: A Primer on Automatic Stabilizers

Policymakers must consider automatic policy responses to recessions—EI benefits increased by nearly $5 billion in 2009


Policymakers must consider automatic policy responses to recessions—EI benefits increased by nearly $5 billion in 2009VANCOUVER—Regular employment insurance benefits (excluding special benefits such as maternity benefits) automatically increased by nearly $5 billion in 2009 during the last recession in response to increasing unemployment, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank. “When unemployment increases, as it does during recessions, employment insurance benefits increase automatically, without policymakers in Ottawa crafting a new policy in response to the economic downturn,” said Jake Fuss, Fraser Institute economist and co-author of Fiscal Policy and Recessions: A Primer on Automatic Stabilizers.
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