%0 Report
        %A Tonin, Mirco
%A Kolm, Ann-Sofie
        %T In-Work Benefits and Unemployment
        %D 2011
        %8 2011 Feb
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 5473
        %U https://www.iza.org/publications/dp5473
        %X In-work benefits are becoming an increasingly relevant labour market policy, gradually expanding in scope and geographical coverage. This paper investigates the equilibrium impact of in-work benefits and contrasts it with the traditional partial equilibrium analysis. We find under which conditions accounting for equilibrium wage adjustments amplifies the impact of in-work benefits on search intensity, participation, employment, and unemployment, compared to a framework in which wages are fixed. We also account for the financing of these benefits and determine the level of benefits necessary to achieve efficiency in a labour market characterized by search externalities.
        %K search
%K in-work benefits
%K labour force participation
%K wage adjustment