We investigate how continental European unemployment can be reduced without reducing unemployment benefits and without reducing the net income of low-wage earners. Lower unemployment replacement rates reduce unemployment, the net wage, and unemployment benefits. A lower tax on labor increases...

We analyse the influence of wage bargaining on the firm´s research incentive. In a duopoly setting, firms invest resources into a Reinganum-type patent race. The wage is bargained for with a union. Besides the holdup and the strategic effect, which have been analysed before, we are able to...

Unemployment is still the most pressing economic problem in Europe. It is consensus among most economists that the major fraction of the unemployment problem is not caused by short term business cycle factors, but is caused by structural problems. Thus, unemployment in Europe is a long term...