In-work benefits and unemployment

Arbeitspapier

In-work benefits are becoming an increasingly relevant labour market policy, gradually expanding in scope and geographical coverage. This paper investigates the equilibrium impact of in-work benefits and contrasts it with the traditional partial equilibrium analysis. We find under which conditions accounting for equilibrium wage adjustments amplifies the impact of in-work benefits on search intensity, participation, employment, and unemployment, compared to a framework in which wages are fixed. We also account for the financing of these benefits and determine the level of benefits necessary to achieve efficiency in a labour market characterized by search externalities.

Show object

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 5473

Classification and Topics

• Classification: Wirtschaft ; Labor Force and Employment, Size, and Structure ; Wages, Compensation, and Labor Costs: Public Policy ; Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
• Subject: in-work benefits ; search ; labour force participation ; wage adjustment ; Arbeitsmarkt ; Arbeitslosigkeit ; Arbeitsuche ; Lohnverhandlungen

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Tonin, Mirco ; Kolm, Ann-Sofie
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2011

Further information

• Handle: http://hdl.handle.net/10419/46031
• URN: urn:nbn:de:101:1-201104113462