Employment Effects of Welfare Reforms : Evidence from a Dynamic Structural Life-Cycle Model

In this paper we develop a dynamic structural life-cycle model of labor supply behavior which fully accounts for the effect of income tax and transfers on labor supply incentives. Additionally, the model recognizes the demand side driven rationing risk that might prevent individuals from realizing their optimal labor supply state, resulting in involuntary unemployment. We use this framework to study the employment effects of transforming a traditional welfare state, as is currently in place in Germany, towards a more Anglo-American system in which a large proportion of transfers are paid to the working poor

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Year of publication:	[2021]
Authors:	Haan, Peter ; Prowse, Victoria L. ; Uhlendorff, Arne
Publisher:	[S.l.] : SSRN
Subject:	Sozialreform \| Welfare reform \| Beschäftigungseffekt \| Employment effect \| Arbeitsangebot \| Labour supply \| Öffentliche Sozialleistungen \| Social security benefits \| Aktivierende Arbeitsmarktpolitik \| Workfare \| Theorie \| Theory \| Lebenszyklus \| Life cycle \| Wirkungsanalyse \| Impact assessment \| Deutschland \| Germany \| Anreiz \| Incentives \| Einkommensteuer \| Income tax \| Theorie der unfreiwilligen Arbeitslosigkeit \| Theory of involuntary unemployment

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