Lingens, Jorg
Waelde, Klaus
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 labour increases net wages and - for certain benefit-systems - unemployment benefits as well.
Combining these two policies allows to reduce unemployment in countries with "net-Bismarck" and Beveridge systems without reducing net income of workers or the unemployed. Such a policy becomes self-financing under realistic parameter
constellations when taxes are reduced only for low-income workers.
Bibliographic reference |
Lingens, Jorg ; Waelde, Klaus. Pareto-Improving Unemployment Policies. ECON Working Papers ; 2005/33 (2005) |
Permanent URL |
http://hdl.handle.net/2078.1/5715 |