Worker retraining and transfer payments: The political economy of social protection

Sanjay Jain

No wp-2017-44, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: We conduct an incentive-theoretical analysis of political economy considerations in the design of social protection programmes in developing countries to accompany economic reforms. We focus on two aspects of social protection—the provision of redistribution and retraining—that arguably characterize many reform packages. We analyse the interaction of compensatory redistribution and retraining programmes, and demonstrate that the provision of redistributive programmes might distort incentives for individuals to undertake worker retraining.

Keywords: Political economy; Social protection; Transfer payments; Economic reform; Redistribution (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:unu:wpaper:wp-2017-44

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