The financial crisis has been attributed partly to perverse incentives for traders at banks and has led policy makers to propose regulation of banks' remuneration packages. We explain why poor incentives for traders cannot be fully resolved by only regulating the bank's top executives, and why...

Exchange rate risk will only have a small effect on international transactions as long as this risk is easily tradable. We find evidence indicating that the availability of currency futures can explain the relatively small impact of exchange rate volatility on trade. The impact of exchange rate...

This paper reviews options of labour market-modelling in a CGE framework. On the labour-supply side, two principal modelling options are distinguished and discussed: aggregated, representative households and microsimulation based on individual household data.On the labour-demand side, we focus...

This paper presents some suggestions for the specification of dynamic models. These suggestions are based on the supposed continuous-time nature of most economic processes. In particular, the partial adjustment model -or Koyck lag model- is discussed. The refinement of this model is derived...

Frisch and Tinbergen founded the standard framework for finding the optimal economic policy by maximizing the welfare function under constraints supplied by the econometric model. Frisch worried about the reliability of the model and Tinbergen thought that it would be too difficult to specify...

This paper applies the theory of auctioning incentive contracts to welfare-to-work programs. In several countries, the government procures welfare-to-work projects to employment service providers. In doing so, the government trades off adverse selection (the winning provider is not the most...

This paper examines the effects of experience rating on the inflow into disability insurance (DI) in the Netherlands, using unique longitudinal administrative data from the Dutch social benefit administration for the years 2000-2002. We follow a difference-in-differences approach to identify...

As of 2006, the Dutch healthcare system will be run by regulated competition. An important part of regulated competition is a system of risk adjustment. This paper presents an empirical analysis of the effects of risk adjustment in the Dutch social health insurance system covering the years...

Using the Dutch Labour Force Survey 1991-2001, the authors investigate the incidence of part-time employment in the country with the highest part-time employment rate of the OECD countries. Women fulfil most part-time jobs, but nevertheless a considerable fraction of men works part-time as...

Financial aid to students in tertiary education can contribute to human capital accumulation through two channels: increased enrolment and improved student performance. We analyse the quantitative importance of both channels in the context of a student loan program (SOFES) implemented at...