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Measuring the Equilibrium Effects of Unemployment Benefits Dispersion

Gerard van den Berg, Geert Ridder () and Aico van Vuuren

No 2541, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We analyse the impact of unemployment benefits and minimum wages using an equilibrium search model, which allows for dispersion of benefits and productivity levels, job-to-job transitions, and structural and frictional unemployment. The estimation method uses readily available aggregate data on marginal distributions of unemployment durations as well as wages and benefit levels. Different causes of structural and frictional unemployment are investigated. We investigate the efficiency of the imposition of a single benefit level for all household types and the introduction of an Earned Income Tax Credit.

Keywords: Equilibrium search; Wages; Benefit levels; Minimum wages; Welfare (search for similar items in EconPapers)
JEL-codes: C41 E24 J31 J64 (search for similar items in EconPapers)
Date: 2000-08
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Citations: View citations in EconPapers (5)

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