The extension of short-time work schemes during the Great Recession: A story of success?

Bjoern Brey and Matthias Hertweck

No 2016-05, Working Paper Series of the Department of Economics, University of Konstanz from Department of Economics, University of Konstanz

Abstract: This paper evaluates the effectiveness of short-time work [STW] extensions — e.g. relaxing eligibility criteria or implementing new STW schemes — in the OECD during and after the Great Recession. First, we find that the dampening effect of STW on the unemployment rate diminishes at higher take-up rates. Second, only countries with preexisting STW schemes were able to fully exploit the benefits of STW. Third, the effects of STW are strongest when GDP growth is deeply negative at the beginning of recessions. Our results indicate that STW is most effective when used as a fast-responding automatic stabilizer.

Keywords: job destruction; labor policy; short-time work; unemployment (search for similar items in EconPapers)
JEL-codes: E24 J23 J63 J65 J68 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2016-02-16
New Economics Papers: this item is included in nep-eur and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (34)

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Related works:
Journal Article: THE EXTENSION OF SHORT-TIME WORK SCHEMES DURING THE GREAT RECESSION: A STORY OF SUCCESS? (2020)
Working Paper: The Extension of Short-time Work Schemes during the Great Recession: A Story of Success? (2016)
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