ISSN:
1572-9982
Source:
Springer Online Journal Archives 1860-2000
Topics:
Economics
Notes:
Summary The elements of the social security system, such as unemployment benefits, minimum wages and contributions by employers and employees, may affect both labour demand and labour supply in various ways. This article investigates to what extent the measured effects of the social security system on the labour market depend on the way of modelling the social security system. Starting point of the analysis is the well known Minford model, modified and adapted to the Dutch situation. The model assumes equilibrium on the labour and goods markets. However, policy analysis in The Netherlands is traditionally based on disequilibrium modelling of the labour and goods markets. This article analyses the differences in the working of these models. It is shown that the assumptions that both the labour market and goods markets clear in each period, which in Minford's model implicitly determines the wage and price level, have a major influence on the model's measurement of the impact of social security policy.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1007/BF01460430
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