Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/46016
Authors: 
Steiner, Viktor
Wakolbinger, Florian
Year of Publication: 
2010
Series/Report no.: 
Discussion paper series // Forschungsinstitut zur Zukunft der Arbeit 5191
Abstract: 
We analyze the labor supply and income effects of a needs-based minimum benefit system (Bedarfsorientierte Mindestsicherung) to be introduced in Austria by the end of this/beginning of next year. The aim of this reform is to reduce poverty as well as increasing employment rates of recipients of social assistance. On the basis of a behavioral microsimulation model we show that this new system will slightly increase incomes for the poorest households and slightly reduce labor supply due to the generous allowances for marginal employment under the current and the planned regulations of unemployment assistance. As an alternative, we analyze a reform proposal which reduces financial incentives for marginal employment not covered by social security, and rewards working longer hours by a wage subsidy. Although this alternative reform would yield modest positive labor supply effects, a relatively large number of households would suffer income losses.
Subjects: 
work incentives
labor supply
social safety system
microsimulation
JEL: 
H31
I38
J22
Document Type: 
Working Paper

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