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dc.contributor.authorDagsvik, John K.
dc.contributor.authorZhiyang, Jia
dc.contributor.authorOrsini, Kristian
dc.contributor.authorVan Camp, Guy
dc.date.accessioned2012-07-20T12:50:39Z
dc.date.available2012-07-20T12:50:39Z
dc.date.issued2011
dc.identifier.citationEmpirical Economics, Volume 40, Number 3 (2011), 779-806no_NO
dc.identifier.issn1435-8921
dc.identifier.issnhttp://dx.doi.org/10.1007/s00181-010-0367-6
dc.identifier.urihttp://hdl.handle.net/11250/177908
dc.descriptionPost-print version of the article (peer reviewed). The original publication is available at www.springer.comno_NO
dc.description.abstractAbstract In recent decades, many “Making Work Pay” policies have been implemented in OECD countries. These policies aim at improving the financial incentives for work while maintaining high levels of social protection. Examples include the Earned Income Tax Credit in the USA and theWorking Family Tax Credit in the UK. While these policies are proven to be quite effective with respect to poverty alleviation, many worry that they may discourage labor supply on the intensive margin. We consider an alternative measure implemented in Belgium: the Workbonus, which subsidizes social security contributions for low-skilled workers. This program differs from other measures in that the eligibility and the level of the subsidy are based on full-time equivalent earnings. The instrument therefore distinguishes between low skill and low effort and avoids the above-mentioned disincentive effect. We assess the effects of the Workbonus on labor supply using a particular discrete-choice labor supply model in which individuals are assumed to choose among jobs belonging to individual-specific latent choice sets. In particular, we compare the Workbonus with a tax credit system temporarily implemented in Belgium in 2001–2004. Results show that both measures have a positive impact on labor supply. However, the Workbonus is more efficient in terms of cost per additional full-time equivalent position created and avoids the “part-time trap” implicit in the tax credit system.no_NO
dc.language.isoengno_NO
dc.publisherSpringerno_NO
dc.subjectLabor supplyno_NO
dc.subjectStructural modelingno_NO
dc.subjectMicrosimulationno_NO
dc.subjectSocial protectionno_NO
dc.subjectTax policyno_NO
dc.subjectIncome taxno_NO
dc.subjectScientific articleno_NO
dc.titleSubsidies on low-skilled workers social security contributions: the case of Belgiumno_NO
dc.typeJournal articleno_NO
dc.typePeer reviewedno_NO
dc.subject.nsiVDP::Social science: 200::Economics: 210::Economics: 212no_NO
dc.source.pagenumber779-806no_NO
dc.source.volume40no_NO
dc.source.journalEmpirical Economicsno_NO
dc.source.issue3no_NO


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