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Reforming the Benefit System to 'Make Work Pay': Options and Priorities in a Weak Labour Market

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  • Immervoll, Herwig

    (OECD, Paris)

Abstract

Policies that support the unemployed, while reducing employment barriers and benefit dependency, are of particular interest in the current economic climate. This paper examines alternative policy approaches for combining adequate income support for the jobless with incentives to keep out-of-work spells short. After summarising the main parameters of existing income support measures for the unemployed in EU and OECD countries, I review evidence on the economic relevance of work incentives and discuss their significance when labour markets are weak during and after an economic downturn. Based on the available evidence, I propose a set of policy priorities to strengthen both the "protection" and the "promotion" functions of unemployment support.

Suggested Citation

  • Immervoll, Herwig, 2012. "Reforming the Benefit System to 'Make Work Pay': Options and Priorities in a Weak Labour Market," IZA Policy Papers 50, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izapps:pp50
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    References listed on IDEAS

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    Cited by:

    1. Rodrigo Fernandez & Herwig Immervoll & Daniele Pacifico & Céline Thévenot, 2016. "Faces of joblessness: Characterising employment barriers to inform policy," OECD Social, Employment and Migration Working Papers 192, OECD Publishing.
    2. Marchal, Sarah & Marx, Ive, 2015. "Stemming the Tide: What Have EU Countries Done to Support Low-Wage Workers in an Era of Downward Wage Pressures?," IZA Discussion Papers 9390, Institute of Labor Economics (IZA).
    3. Luz Adriana Flórez, 2014. "Optimal Policy with Informal Sector and Endogenous Savings," Borradores de Economia 11960, Banco de la Republica.
    4. Herwig Immervoll & Stephen P. Jenkins & Sebastian Königs, 2015. "Are Recipients of Social Assistance 'Benefit Dependent'?: Concepts, Measurement and Results for Selected Countries," OECD Social, Employment and Migration Working Papers 162, OECD Publishing.

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    More about this item

    Keywords

    unemployment benefits; income support; work incentives; activation;
    All these keywords.

    JEL classification:

    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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