Heterogeneous Labour Markets in a Microsimulation-AGE Model: Application to Welfare Reform in Germany

Arbeitspapier

Labour market reforms that are designed to stimulate labour supply at the lower end of the wage distribution can never be precisely restricted to affect only the target group. Spillovers to and feedback from other segments of the labour market are unavoidable and may counteract the direct effects of the reform. An adequate representation of heterogeneous labour markets becomes therefore an important issue for the assessment of reforms. We analyse the possible interactions between labour market segments in a combined, consistent microsimulation-AGE model with a flexible representation of substitution possibilities and different wage-forming regimes. We look at a stylised reform and find labour-demand cross-price elasticities between the low and medium skilled to be the main drivers of the results. Interaction with the high-skilled segment is less pronounced.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ZEW Discussion Papers ; No. 08-043

Classification and Topics

• Classification: Wirtschaft ; Time Allocation and Labor Supply ; Computable and Other Applied General Equilibrium Models ; Trade Unions: Objectives, Structure, and Effects
• Subject: Applied general equilibrium model ; microsimulation ; discrete working time choice ; heterogeneous labour markets ; labour market reform ; Hartz-Reform ; Wirtschaftspolitische Wirkungsanalyse ; Arbeitsangebot ; Ökonomischer Anreiz ; Arbeitsmarktsegmentierung ; Qualifikation ; Lohnverhandlungen ; Mikrosimulation ; Allgemeines Gleichgewicht ; Theorie ; Deutschland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Boeters, Stefan ; Feil, Michael
• Event: Veröffentlichung
• (who): Zentrum für Europäische Wirtschaftsforschung (ZEW)
• (where): Mannheim
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/24739
• Last update: 10.03.2025, 11:42 AM CET