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The Displacement Effect of Labour-Market Programs: MONASH Analysis

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Author Info
PETER B. DIXON
MAUREEN T. RIMMER

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Abstract

A key question concerning labour-market programs is the extent to which they generate jobs for their target group at the expense of others. This effect is measured by displacement percentages. We describe a version of the MONASH model designed to quantify the effects of labour-market programs. Our simulation results suggest that: (i) labour-market programs can generate significant long-run increases in employment; (ii) displacement percentages depend on how a labour-market program affects the income trade-off faced by target and non-target groups between work and non-work; and (iii) displacement percentages are larger in the short run than in the long run. Copyright © 2006 The Economic Society of Australia.

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Article provided by The Economic Society of Australia in its journal Economic Record.

Volume (Year): 82 (2006)
Issue (Month): s1 (09)
Pages: S26-S40
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Handle: RePEc:bla:ecorec:v:82:y:2006:i:s1:p:s26-s40

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  1. James Giesecke & G.A. Meagher, 2009. "Population Ageing and Structural Adjustment," Centre of Policy Studies/IMPACT Centre Working Papers g-181, Monash University, Centre of Policy Studies/IMPACT Centre. [Downloadable!]
    Other versions:
  2. Jochen Michaelis & Alexander Spermann, 2009. "Geringqualifizierte Arbeit, Marktlöhne und Sozialpolitik: Konzepte für Deutschland," MAGKS Papers on Economics 200920, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung). [Downloadable!]
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This page was last updated on 2009-11-28.

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