Jeffrey Brian Wenger

The RAND Corporation
Economics, Statistics & Sociology

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For the past 10 years, Jeffrey Wenger has been assistant and associate professor at the University of Georgia where he taught econometrics, statistics, economics, and policy evaluation. He is currently a Senior Policy Researcher at the RAND Corporation in Santa Monica. Wenger’s primary expertise is in unemployment insurance; he has published studies in the areas of UI financing, automatic triggers for extending UI benefits, and the role of information on UI application rates. Wenger is also interested in issues of retirement and the role of business cycles on retirement savings. He has published research on the asynchronicity of stock and labor markets and its effects on retirement savings and research on preference heterogeneity and its role on savings rates and borrowing options in defined contribution plans. His current research includes work on long-term unemployment among late career workers and an examination of the importance of skills mismatch versus labor market discrimination in explaining the duration of unemployment for older unemployed workers. In a previous life Wenger was an industrial engineer, and later quality control manager at O’Neill Inc. in San Francisco where he learned the intricacies of wetsuit manufacturing. After that he worked for Guess? jeans in Los Angeles as production manager. Mostly he was in charge of making sure your denim looked properly faded. Wenger received his Ph.D. in public policy from the University of North Carolina – Chapel Hill and a B.A. in mathematics from the University of California – Santa Cruz.

Citation:
Smith, D. L. and Wenger, J. B. (2013), State Unemployment Insurance Trust Solvency and Benefit Generosity. Journal of Policy Analysis and Management, 32: 536–553.
Abstract: This paper employs panel estimators with data on the 50 American states for the years 1963 to 2006 to test the relationship between Unemployment Insurance (UI) trust fund solvency and UI benefit generosity. We find that both average and maximum weekly UI benefit amounts, as ratios to the average weekly wage, are higher in states and in years with more highly solvent trust funds. This result holds after controlling for state-level unemployment rate, gross domestic product, population growth, legislative political ideology, partisan control of the executive and legislative branches, and gubernatorial election year across multiple specifications, including fixed-effects and dynamic panel estimators. We propose a theory of moderate coupling as the causal mechanism, whereby UI program benefits and financing are directly related but are not as tightly linked as in other social insurance programs, such as Medicaid. The findings have important policy implications for the funding of states’ UI systems. As a consequence of moderate coupling, the countercyclicality of the UI program is dampened.
DOI: 10.1002/pam.21701
Citation:
Wenger, J.B. and Weller, C.E. Boon or Bane: 401(k) Loans and Employee Contributions Research on Aging (September 2014) 36: 527-556
Abstract: Economic and behavioral theories arrive at different conclusions about the effect of being allowed to borrow from one’s defined-contribution (DC) retirement plan on people’s contributions to DC plans. Traditional life-cycle models unambiguously suggest that the borrowing option makes people better off than not being able to borrow. Households consequently contribute more to their DC plans than they would absent the borrowing option. Previous research finds that the ability to borrow from a DC plan increases contemporaneous contributions, consistent with traditional models. Behavioral finance, in contrast, suggests that some workers may operate with nonlinear time discounting. They plan on saving more in the future but change their mind and save less than initially planned as time passes. These workers may enjoy higher lifetime utility if they have no loan option because DC plans serve as commitment devices for retirement saving. The money cannot be used prior to retirement. Absent this commitment device, contributions may be lower for some households than would be the case without a DC loan option. We study DC plan contributions for households with heterogeneous preferences about discounting. We separate households into those that demonstrate inconsistent (or paradoxical) borrowing behavior, which may reflect nonlinear time discounting, and those with more consistent borrowing behavior. We find that a DC loan option raises current savings, but does so more for households with consistent borrowing behavior than for those with inconsistent borrowing behavior.
DOI: 10.1177/0164027513507001
Citation:
Wilkins, V. M. and Wenger, J. B. (2014), Belief in a Just World and Attitudes Toward Affirmative Action. Policy Studies Journal, 42: 325–343.
Abstract: The effect of identity, as socially constructed by race and gender, on social policies has been widely examined in policy analysis. Policy analysis would be improved by a wider discussion that includes the influence of social-psychological constructs on social provision. We fill this gap by drawing on the theory of the “belief in a just world” and link this theory to attitudes toward the support of controversial government programs. We argue that this theory is a critical antecedent to the previous research on social construction. We hypothesize that citizens who perceive that the world is just and that opportunities are equal between groups are much less likely to favor government interventions altering market outcomes. We find that after controlling for race, sex, and political ideology, respondents who believe that luck is the primary determinant of success (low belief in a just world) are more supportive of preferential hiring programs for African Americans and women.
DOI: 10.1111/psj.12063
Citation:
Wenger, J. B., and M. J. Walters. 2006. "Why Triggers Fail (And What to Do About It): An Examination of the Unemployment Insurance Extended Benefits Program." Journal of Policy Analysis and Management 25: 553-575.
Citation:
Darcy, L. P., M. Stater, and J. B. Wenger. 2009. "Search Costs and Re-Employment Wage Gains for Displaced Workers." Industrial Relations: A Journal of Economy and Society 48.
Abstract: Involuntary job separation generally leads to lower re-employment wages. However, 20?30 percent of displaced workers experience re-employment wage gains. Theoretically, workers with higher search costs accept jobs when the marginal benefit of search is relatively high. When displaced, these workers experience wage gains because they are forced into additional search. Using data from the Displaced Worker Survey, we find that higher search costs (measured as the wage residual from the predisplacement job) are associated with higher re-employment wages.
DOI: 10.1111/j.1468- 232X.2009.00577.x
Citation:
Weller, C. E., and J. B. Wenger. Forthcoming. "Easy Money or Hard Times?: Health and 401(k) Loans." Contemporary Economic Policy.
Abstract: Rising health care costs and declining personal savings rates are nearly synonymous with household medical debt. For some, defined contribution (DC) retirement savings plans provide a ready source of funds to meet these medical debts. We examine whether health status and health insurance coverage predict the likelihood of having a DC loan using data from the Federal Reserve's triennial Survey of Consumer Finances (SCF) from 1989 to 2007. We find that poor health raises the likelihood that a household will borrow from their DC plans, even controlling for other forms of debt, access to credit, and whether households are covered by health insurance. Our estimates of the amount of the DC loan, taking selection effects into account, indicate that DC loan amounts are also influenced by health status; those with poor health borrow more from their DC plans. Apart from health status, once a household decides to borrow from their retirement funds, race and education also influence how much to borrow. We argue that public policy can improve the long-term financial retirement security of households by offering more opportunities to save for medical emergencies, while cautiously maintaining the opportunity to borrow from DC plans. (JEL D12, D14, D91)
DOI: 10.1111/j.1465-7287.2011.00251.x

Substantive Focus:
Economic Policy SECONDARY
Health Policy
Defense and Security
Social Policy PRIMARY

Theoretical Focus:
Policy Process Theory SECONDARY
Policy Analysis and Evaluation PRIMARY

Keywords

UNEMPLOYMENT UNEMPLOYMENT INSURANCE HEALTH INSURANCE HEALTH SOCIAL ISOLATION DESERVINGNESS