Arbeitspapier

Work Incentives and Labor Supply Effects of the 'Mini-Jobs Reform' in Germany

We analyze the work incentives and labor supply effects of the so-called mini- jobs reform (subsidies of social security contributions to people with low-earnings jobs) introduced in Germany in April 2003. The analysis is based on a structural labor supply model embedded in a detailed tax-benefit microsimulation model for which we use the German Socio-Economic Panel (GSOEP). Our simulation results show that the likely employment effects of the mini-jobs reform will be small. The small positive participation effect is outweighed by a negative hours effect among already employed workers. The fiscal effects of the reform are also likely to be negative. We conclude that the analyzed mini-job reform is not an effective policy to increase employment of people with low earnings capacity.

Language
Englisch

Bibliographic citation
Series: DIW Discussion Papers ; No. 438

Classification
Wirtschaft
Fiscal Policies and Behavior of Economic Agents: Household
Time Allocation and Labor Supply
Subject
Arbeitsangebot
Ökonomischer Anreiz
Ungeschützte Beschäftigung
Reform
Beschäftigungseffekt
Deutschland

Event
Geistige Schöpfung
(who)
Steiner, Viktor
Wrohlich, Katharina
Event
Veröffentlichung
(who)
Deutsches Institut für Wirtschaftsforschung (DIW)
(where)
Berlin
(when)
2004

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Steiner, Viktor
  • Wrohlich, Katharina
  • Deutsches Institut für Wirtschaftsforschung (DIW)

Time of origin

  • 2004

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