@inproceedings{dePinto2012Unemployment,
abstract = {Trade liberalization is no Pareto-improvement - there are winners (high-skilled) and losers (low-skilled). To compensate the losers the government is assumed to introduce unemployment benefits (UB). These benefits are financed by either a wage tax, a payroll tax, or a profit tax. Using a Melitz-type model of international trade with unionized labour markets and heterogeneous workers we show that: (i) UB financed by a wage tax reduce aggregate employment but increase welfare measured by per capita output. (ii) UB financed by a payroll tax reduce aggregate employment and welfare. If UB exceeds a well-defined threshold, the trade gains will be completely destroyed. (iii) UB financed by a profit tax reduce the unemployment rate of the low-skilled, but also reduces welfare. The threshold for the level of UB, where the trade gains are destroyed by the redistribution scheme, is higher compared to the case of a payroll tax.},
author = {Marco de Pinto},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {F10; F16; H20; 330},
language = {eng},
number = {G06-V3},
publisher = {ZBW - Deutsche Zentralbibliothek f\"{u}r Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft},
series = {Beitr\"{a}ge zur Jahrestagung des Vereins f\"{u}r Socialpolitik 2012: Neue Wege und Herausforderungen f\"{u}r den Arbeitsmarkt des 21. Jahrhunderts - Session: Labor Markets III},
title = {Unemployment Benefits as Redistribution Scheme of Trade Gains - a Positive Analysis},
url = {http://hdl.handle.net/10419/66059},
year = {2012}
}
