Arbeitspapier

Unemployment vouchers versus low-wage subsidies

The paper examines the relative effectiveness of two policy proposals in reducing unemployment and working poverty: unemployment vouchers and low-wage subsidies. The unemployment vouchers are targeted exclusively at the unemployed (especially the longterm unemployed) and are provided only for a limited period of time. The low-wage subsidies, on the other hand, are granted to all low-wage earners regardless of their employment history and are of limitless duration. Our analysis indicates that the relative effectiveness of the two policies depends on workers? prospective wage growth. The more upwardly mobile workers are (i.e. the more their wages rise with employment duration), the more effective will unemployment vouchers be relative to low-wage subsidies. Conversely, the greater the danger that workers come to be trapped in dead-end jobs with flat wage profiles, the more effective will low-wage subsidies be relative to unemployment vouchers.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 537

Klassifikation
Wirtschaft
Mobility, Unemployment, and Vacancies: Public Policy
Wages, Compensation, and Labor Costs: Public Policy
Labor Demand
Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
Unemployment: Models, Duration, Incidence, and Job Search
Unemployment Insurance; Severance Pay; Plant Closings
Thema
unemployment
poverty
wages
employment
vouchers
subsidies
inequality
Arbeitsmarktpolitik
Voucher
Arbeitslosenversicherung
Lohnsubvention
Wirtschaftspolitische Wirkungsanalyse
Theorie

Ereignis
Geistige Schöpfung
(wer)
Orszag, Jonathan Michael
Snower, Dennis J.
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2002

Handle
Letzte Aktualisierung
20.09.2024, 08:21 MESZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Orszag, Jonathan Michael
  • Snower, Dennis J.
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2002

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