Making Work Pay for the Elderly Unemployed: Evaluating Alternative Policy Reforms for Germany

Peter Haan and Viktor Steiner ()
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Viktor Steiner: Free University of Berlin

No 2424, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We evaluate three policy reforms targeted at older unemployed people: (i) an hourly wage subsidy, (ii) an in-work credit, and (iii) a subsidy of social security contributions on low wages. The work incentive, labour supply and welfare effects of these hypothetical reforms are analysed on the basis a detailed micro-simulation model for Germany which includes a structural household labour supply model. We find that the simulated labour supply effects of the three policy reforms would be rather similar and of moderate size, ranging between 20,000 and 30,000 older women and between 10,000 and 20,000 older men. Our results also suggest that the hourly wage subsidy yields the highest welfare gains.

Keywords: in-work support; wage subsidies; unemployment; elderly workers (search for similar items in EconPapers)
JEL-codes: H21 J21 J48 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2006-11
New Economics Papers: this item is included in nep-lab and nep-pbe
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Citations: View citations in EconPapers (10)

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Related works:
Journal Article: Making Work Pay for the Elderly Unemployed - Evaluating Alternative Policy Reforms for Germany (2008)
Working Paper: Making Work Pay for the Elderly Unemployed: Evaluating Alternative Policy Reforms for Germany (2006)
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