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Title:Pareto-improving unemployment policies PDF Logo
Authors:Lingens, Jörg
Wälde, Klaus
Issue Date:2006
Series/Report no.:CESifo working paper 1807
Abstract: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 of the unemployed. Such a policy becomes self-financing under realistic parameter constellations when taxes are reduced only for low-income workers.
JEL:J38
J51
H23
E60
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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