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dc.contributor.authorVAN DER PLOEG, Frederick
dc.identifier.citationJournal of Public Economic Theory, 2006, 8, 4, 603-610en
dc.description.abstractAlthough unconditional unemployment benefits destroy jobs in competitive and noncompetitive labor markets, conditional benefits can spur job growth in noncompetitive labor markets. Unconditional benefits reduce the penalty of shirking and misconduct, while conditional benefits increase this penalty. This is shown for the efficiency-wage, no-shirking model of the labor market developed by Shapiro and Stiglitz (1984). Switching from unconditional to conditional benefits lowers unemployment. Tough eligibility requirements are thus important components of the welfare state. However, if conditional benefits are financed by a payroll tax, conditional benefits exert upward wage pressure so that unemployment falls by less and may even increase.en
dc.relation.ispartofJournal of Public Economic Theory
dc.titleDo Conditional Benefits Reduce Equilibrium Unemployment?en
dc.neeo.contributorVAN DER PLOEG|Frederick|aut|

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