Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/20412
Authors: 
van der Linden, Bruno
Lehmann, Etienne
Year of Publication: 
2004
Series/Report no.: 
IZA Discussion paper series 1172
Abstract: 
This paper revisits the normative properties of search-matching economies when homogeneous workers have concave utility functions and wages are bargained over. The optimal allocation of resources is characterized first when information is perfect and second when search effort is not observable. To decentralize these optima, employees should be unable to extract a rent when information is perfect. An appropriate positive rent is however needed in the second case. To implement these optima, non-linear income taxation is a key complement to unemployment insurance. According to the level of the workers? bargaining power, taxation has to be progressive or regressive. These properties are also studied through numerical simulations.
Subjects: 
unemployment
non-linear taxation
unemployment benefits
moral hazard
search
matching
JEL: 
H21
D82
J64
J65
J68
Document Type: 
Working Paper

Files in This Item:
File
Size
511.57 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.