Incentives to Work: The Case of Germany
AbstractBased on a description of the German system of taxes and transfers, the incentives to work are analyzed for several groups of the labor force. The effects of the “Hartz IV” reform (effective from 2005 onwards) on the incentives receive particular attention. It turns out that the marginal (explicit and implicit) tax rates for most groups of the labor force remain high. It is concluded that employment probably will not be affected significantly by that part of the reform which aims at strengthening the incentives to work. Other elements of “Hartz IV” are only touched on.
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Bibliographic InfoPaper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1237.
Length: 67 pages
Date of creation: Feb 2005
Date of revision:
Income tax rates; contributions to social security; unemployment benefits; implicit tax rates; incentives to work;
Find related papers by JEL classification:
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-03-06 (All new papers)
- NEP-EEC-2005-03-06 (European Economics)
- NEP-LAB-2005-03-06 (Labour Economics)
- NEP-PBE-2005-03-06 (Public Economics)
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.:
- Alfred Boss, 2001. "Sozialhilfe, Lohnabstand, Leistungsanreize und Mindestlohnarbeitslosigkeit," Kiel Working Papers 1075, Kiel Institute for the World Economy.
- Breyer, Friedrich & Franz, Wolfgang & Homburg, Stefan & Schnabel, Reinhold & Wille, Eberhard, 2004. "Reform der sozialen Sicherung," EconStor Books, ZBW - German National Library of Economics, number 92399, April.
- Herbert Buscher, 2004. "Hartz IV: 1-Euro-Jobs setzen falsche Anreize," Wirtschaft im Wandel, Halle Institute for Economic Research, vol. 10(11), pages 300-306.
- Berger, Helge & Danninger, Stephan, 2006.
"The employment effects of labor and product markets deregulations and their implications for structural reform,"
2006/10, Free University Berlin, School of Business & Economics.
- Helge Berger & Stephan Danninger, 2007. "The Employment Effects of Labor and Product Market Deregulation and Their Implications for Structural Reform," IMF Staff Papers, Palgrave Macmillan, vol. 54(3), pages 591-619, July.
- Helge Berger & Stephan Danninger, 2006. "The Employment Effects of Labor and Product Markets Deregulation and their Implications for Structural Reform," CESifo Working Paper Series 1709, CESifo Group Munich.
- Helge Berger & Stephan Danninger, 2005. "Labor and Product Market Deregulation: Partial, Sequential, or Simultaneous Reform?," IMF Working Papers 05/227, International Monetary Fund.
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