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Workfare: Eine wirksame Alternative zum Kombilohn

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  • Bonin, Holger

    ()
    (ZEW Mannheim)

  • Schneider, Hilmar

    ()
    (CEPS/INSTEAD)

Abstract

In the debate on in-work benefits in Germany it is often overlooked that such subsidies may only be effective if basic minimum income is remarkably decreased for those who are employable. However, proposals following this principle will hardly achieve political consensus as can be derived from reactions to the model of ifo or the board of economic advisors. IZA is therefore proposing workfare as an effective alternative, which may accomplish a strong incentive for the acceptance of low paid jobs without having to cut the current welfare level. Simulations based on a micro-econometric labor supply model show that this could add to the workforce an additional number of 800,000 workers. Roughly the same effect could be achieved by the ifo model, however, at the expense of massive cuts of disposable income for welfare recipients. Hence, workfare turns out as an efficient alternative. Moreover, there is no useful combination between in-work benefits based on the current welfare level and workfare.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2399.

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Length: 18 pages
Date of creation: Oct 2006
Date of revision:
Publication status: published in: Wirtschaftsdienst, 2006, 86 (10), 645-650
Handle: RePEc:iza:izadps:dp2399

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Keywords: labor supply; low-wage subsidies; in-work benefits; discrete choice; Germany;

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Cited by:
  1. Berthold, Norbert & Coban, Mustafa, 2013. "Kombilohn oder Workfare? Wege aus der strukturellen Arbeitslosigkeit auf dem Prüfstand," Wirtschaftswissenschaftliche Beiträge, Julius-Maximilians-Universität Würzburg, Lehrstuhl für Volkswirtschaftslehre, insbes. Wirtschaftsordnung und Sozialpolitik 122, Julius-Maximilians-Universität Würzburg, Lehrstuhl für Volkswirtschaftslehre, insbes. Wirtschaftsordnung und Sozialpolitik.
  2. Hans-Werner Sinn & Wolfgang Meister & Wolfgang Ochel & Martin Werding, 2007. "Reformkonzepte zur Erhöhung der Beschäftigung im Niedriglohnbereich: Ein Überblick," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, Ifo Institute for Economic Research at the University of Munich, vol. 60(04), pages 03-20, 02.
  3. Eichhorst, Werner, 2007. "Report No. 13: Wachstumsaspekte der Arbeitsmarktpolitik - Von den Nachbarn lernen," IZA Research Reports, Institute for the Study of Labor (IZA) 13, Institute for the Study of Labor (IZA).
  4. Schöb, Ronnie, 2007. "Soziale Grundsicherung und Beschäftigung," Discussion Papers, Free University Berlin, School of Business & Economics 2007/12, Free University Berlin, School of Business & Economics.
  5. Peichl, Andreas & Siegloch, Sebastian, 2010. "Accounting for Labor Demand Effects in Structural Labor Supply Models," IZA Discussion Papers, Institute for the Study of Labor (IZA) 5350, Institute for the Study of Labor (IZA).
  6. Eichhorst, Werner & Zimmermann, Klaus F, 2007. "And Then There Were Four... How Many (and Which) Measures of Active Labour Market Policy Do We Still Need?," CEPR Discussion Papers, C.E.P.R. Discussion Papers 6246, C.E.P.R. Discussion Papers.
  7. Nina Hetzer & Andreas Peichl, 2010. "Steuerstrukturreform trotz leerer Kassen?!," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, Ifo Institute for Economic Research at the University of Munich, vol. 63(01), pages 28-35, 01.
  8. Jochen Michaelis & Alexander Spermann, 2009. "Geringqualifizierte Arbeit, Marktlöhne und Sozialpolitik: Konzepte für Deutschland," MAGKS Papers on Economics, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) 200920, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  9. Werner Eichhorst & Klaus F. Zimmermann, 2007. "And Then There Were Four ...: How Many (and Which) Measures of Active Labor Market Policy Do We Still Need? ; Finding a Balance after the Evaluation of the Hartz Reforms in Germany," Discussion Papers of DIW Berlin, DIW Berlin, German Institute for Economic Research 685, DIW Berlin, German Institute for Economic Research.
  10. Schneider, Hilmar & Uhlendorff, Arne & Zimmermann, Klaus F., 2010. "Mit Workfare aus der Sozialhilfe? Lehren aus einem Modellprojekt," IZA Standpunkte, Institute for the Study of Labor (IZA) 33, Institute for the Study of Labor (IZA).
  11. Clemens Fuest & Joachim Mitschke & Andreas Peichl & Thilo Schaefer, 2007. "Der Kölner Kombilohn für den Niedriglohnsektor," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, Ifo Institute for Economic Research at the University of Munich, vol. 60(11), pages 25-29, 06.
  12. Fuest, Clemens & Peichl, Andreas, 2009. "Grundeinkommen vs. Kombilohn: Beschäftigungs- und Finanzierungswirkungen und Unterschiede im Empfängerkreis," IZA Standpunkte, Institute for the Study of Labor (IZA) 11, Institute for the Study of Labor (IZA).
  13. Andreas Peichl & Nico Pestel & Hilmar Schneider & Sebastian Siegloch, 2011. "Reform der Hartz IV‐Hinzuverdienstregelungen: Ein verfehlter Ansatz," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, Verein für Socialpolitik, vol. 12(1), pages 12-26, 02.
  14. Dennis Snower & Alessio Brown & Christian Merkl, 2007. "Einstellungsgutscheine effektiver als Kombilöhne," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, Ifo Institute for Economic Research at the University of Munich, vol. 60(04), pages 37-41, 02.
  15. Peichl, Andreas & Schneider, Hilmar & Siegloch, Sebastian, 2010. "Documentation IZAΨMOD: The IZA Policy SImulation MODel," IZA Discussion Papers, Institute for the Study of Labor (IZA) 4865, Institute for the Study of Labor (IZA).
  16. Eichhorst, Werner & Zimmermann, Klaus F., 2007. "Dann waren's nur noch vier… Wie viele (und welche) Maßnahmen der aktiven Arbeitsmarktpolitik brauchen wir noch? Eine Bilanz nach der Evaluation der Hartz-Reformen," IZA Discussion Papers, Institute for the Study of Labor (IZA) 2605, Institute for the Study of Labor (IZA).
  17. Brown, Alessio J. G. & Merkl, Christian & Snower, Dennis J., 2007. "Einstellungsgutscheine effektiver als Kombilöhne : Reformkonzepte zur Erhöhung der Beschäftigung im Niedriglohnbereich ; Niedriglohnsektor," Open Access Publications from Kiel Institute for the World Economy, Kiel Institute for the World Economy (IfW) 3966, Kiel Institute for the World Economy (IfW).

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