Staying on the Dole

Holger Strulik, Jean-Robert Tyran and Paolo Vanini

Hannover Economic Papers (HEP) from Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät

Abstract: We develop a simple model of labor market participation, human capital degradation, and re-training. We focus on how non-participation, as a distinct state from unemployment and employment, is determined by the welfare system in interaction with labor market conditions and personal characteristics. We provide a tractable framework to analyze how the decisions to exit the labor force and to mitigate human capital degradation by re-training depend on a broad range of factors such as education, skill degradation, age, labor market shocks, labor taxes, unemployment insurance benefits and social assistance. We extend our framework by allowing for time-inconsistent choices and demonstrate the possibility of an unemployment trap.

Keywords: Unemployment; Non-Participation; Skill Degradation; Re-training; Unemployment Benefits; Social Assistance; Present-Biased Preferences. (search for similar items in EconPapers)
JEL-codes: J31 J38 J64 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2007-10
New Economics Papers: this item is included in nep-hrm, nep-ias and nep-lab
References: Add references at CitEc
Citations:

Downloads: (external link)
http://diskussionspapiere.wiwi.uni-hannover.de/pdf_bib/dp-377.pdf (application/pdf)

Related works:
Working Paper: Staying on the Dole (2006)
Working Paper: Staying on the Dole (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:han:dpaper:dp-377

Access Statistics for this paper

More papers in Hannover Economic Papers (HEP) from Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät Contact information at EDIRC.
Bibliographic data for series maintained by Heidrich, Christian ().