The aims of unemployment insurance with especial reerence to the Wisconsin act

The Wisconsin Unployement Compensation act is based upon the theory that individual unemployment reserves will tend to stabilize insutry. As a result, the act is essentially a stabilization rather han a relief measure. The maximum levy of 2 per cent of the payroll is equivalent to only about 5 per cent costs. Because this is a small factor compared to other costs and risks, it is unlikely to provide an effective deterrent to expansion. This act appers not only to be ineffective as a stabilizing device but also to be inadequate ad a relief measure. The unemployed can expect little direct relifef from legislation based upon the stabilization principle. The heaviest b urden is imposed upon firms least able to bear it and many unemployed are without protection. These defe3cts are inherent qualities of this type of legislation and not accidents of this particular act. It appears that the three-party insuraqnce plan is preferable to this Wisconsin plan.