Beans for breakfast? How exportable is the British workfare model?
AbstractSocial assistance and inactivity traps have long been considered amongst the main causes of the poor employment performance of EU countries. The success of New Labour has triggered a growing interest in instruments capable of combining the promotion of responsibility and self-sufficiency with solidarity with less skilled workers. Making-work-pay (MWP) policies, consisting of transfers to households with low earning capacity, have quickly emerged as the most politically acceptable instruments in tax-benefit reforms of many Anglo Saxon countries. This chapter explores the impact of introducing the British Working Families' Tax Credit in three EU countries with rather different labor market and welfare institutions: Finland, France and Germany. Simulating the reform reveals that, while first round effects on income distribution is considerable, the interaction of the new instrument with the structural characteristics of the economy and the population may lead to counterproductive second round effects (i.e. changes in economic behavior). The implementation of the reform, in this case, could only be justified if the social inclusion (i.e. transition into activity) of some specific household types (singles and single mothers) is valued more than a rise in the employment per se.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by EUROMOD at the Institute for Social and Economic Research in its series EUROMOD Working Papers with number EM2/06.
Date of creation: 01 Apr 2006
Date of revision:
Publication status: published
Contact details of provider:
Postal: RAB Butler Building, University of Essex, Wivenhoe Park, Colchester, ESSEX C04 3SQ
Phone: +44 (0)1206 872957
Fax: +44 (0)1206 873151
Web page: https://www.iser.essex.ac.uk/euromod/
More information through EDIRC
Other versions of this item:
- Bargain, Olivier & Orsini, Kristian, 2006. "Beans for Breakfast? How Exportable Is the British Workfare Model?," IZA Discussion Papers 2025, Institute for the Study of Labor (IZA).
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pierre-André Chiappori & François Bourguignon, 1998. "Fiscalité et redistribution," Revue Française d'Économie, Programme National Persée, vol. 13(1), pages 3-64.
- Soest, A.H.O. van & Das, J.W.M., 2000.
"Family labor supply and proposed tax reforms in the Netherlands,"
Open Access publications from Tilburg University
urn:nbn:nl:ui:12-121735, Tilburg University.
- Soest, A.H.O. van & Das, J.W.M., 2000. "Family Labor Supply and Proposed Tax Reforms in the Netherlands," Discussion Paper 2000-20, Tilburg University, Center for Economic Research.
- Olivier Bargain & Kristian Orsini, 2004.
"In-work policies in Europe: killing two birds with one stone?,"
DELTA Working Papers
2004-13, DELTA (Ecole normale supérieure).
- Bargain, Olivier & Orsini, Kristian, 2006. "In-work policies in Europe: Killing two birds with one stone?," Labour Economics, Elsevier, vol. 13(6), pages 667-697, December.
- Bargain, Olivier & Orsini, Kristian, 2004. "In-work policies in Europe: killing two birds with one stone?," EUROMOD Working Papers EM4/04, EUROMOD at the Institute for Social and Economic Research.
- Bargain, Olivier & Orsini, Kristian, 2004. "In-Work Policies in Europe: Killing Two Birds with One Stone?," IZA Discussion Papers 1445, Institute for the Study of Labor (IZA).
- Richard Blundell & Alan Duncan & Julian McCrae & Costas Meghir, 2000. "The labour market impact of the working families’ tax credit," Fiscal Studies, Institute for Fiscal Studies, vol. 21(1), pages 75-103, March.
- Martin, John P. & Grubb, David, 2001. "What works and for whom: a review of OECD countries' experiences with active labour market policies," Working Paper Series 2001:14, IFAU - Institute for Evaluation of Labour Market and Education Policy.
- James Banks & Richard Disney & Alan Duncan & John Van Reenen, 2005.
"The Internationalisation of Public Welfare Policy,"
Royal Economic Society, vol. 115(502), pages C62-C81, 03.
- James Banks & R Disney & Alan Duncan & John Van Reenen, 2004. "The Internationalisation of Public Welfare Policy," CEP Discussion Papers dp0656, Centre for Economic Performance, LSE.
- James Banks & Richard Disney & Alan Duncan & John Van Reenen, 2004. "The internationalisation of public welfare policy," LSE Research Online Documents on Economics 769, London School of Economics and Political Science, LSE Library.
- Eissa, Nada & Hoynes, Hilary Williamson, 2004. "Taxes and the labor market participation of married couples: the earned income tax credit," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 1931-1958, August.
- Olivier Bargain, 2004. "Aides au retour à l'emploi et activité des femmes en couple," Revue de l'OFCE, Presses de Sciences-Po, vol. 88(1), pages 59-87.
- Mantovani, Daniela & Sutherland, Holly, 2003. "Social indicators and other income statistics using the EUROMOD baseline: a comparison with Eurostat and National Statistics," EUROMOD Working Papers EM1/03, EUROMOD at the Institute for Social and Economic Research.
- Brewer, Mike & Duncan, Alan & Shephard, Andrew & Suarez, Maria Jose, 2006. "Did working families' tax credit work? The impact of in-work support on labour supply in Great Britain," Labour Economics, Elsevier, vol. 13(6), pages 699-720, December.
- Pertti Honkanen & Markus Jäntti & Jukka Pirttilä, 2007. "Alleviating unemployment traps in Finland: Can the efficiency-equity trade-off be avoided?," Discussion Papers 24, Aboa Centre for Economics.
- Ive Marx & Brian Nolan, 2012. "GINI DP 51: In-Work Poverty," GINI Discussion Papers 51, AIAS, Amsterdam Institute for Advanced Labour Studies.
- Brown, Alessio J. G. & Koettl, Johannes, 2012.
"Active Labor Market Programs: Employment Gain or Fiscal Drain?,"
IZA Discussion Papers
6880, Institute for the Study of Labor (IZA).
- Alessio J. G. Brown & Johannes Koettl, 2012. "Active Labor Market Programs - Employment Gain or Fiscal Drain?," Kiel Working Papers 1785, Kiel Institute for the World Economy.
- Marx, Ive & Marchal, Sarah & Nolan, Brian, 2012. "Mind the Gap: Net Incomes of Minimum Wage Workers in the EU and the US," IZA Discussion Papers 6510, Institute for the Study of Labor (IZA).
- Ive Marx & Sarah Marchal & Brian Nolan, 2012. "GINI DP 56: Mind the Gap: Net Incomes of Minimum Wage Workers in the EU and the US," GINI Discussion Papers 56, AIAS, Amsterdam Institute for Advanced Labour Studies.
- Lietz, Christine & Mantovani, Daniela, 2006. "Lessons from building and using EUROMOD," EUROMOD Working Papers EM5/06, EUROMOD at the Institute for Social and Economic Research.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Paul Groves).
If references are entirely missing, you can add them using this form.