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An Evaluation of Paid Leave: Participation and Labor Market Tightness

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  • Karsten Albæk

    (Institute of Economics, University of Copenhagen)

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    Abstract

    This paper analyzes a labor market program which enables workers to leave employment temporarily with a compensation financed by the taxpayers. The main aim of the program was to increase the chances of the unemployed finding a job. However, the empirical analysis reveals a clear negative relationship between the unemployment rate and transition rates from employment into the paid leave scheme. Program participation is low, precisely in those labor market states, where the scheme has a potential to perform as a remedy by increasing the transition rate from unemployment to employment. Several possible explanations are discussed.

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    File URL: http://www.econ.ku.dk/english/research/publications/wp/1999/9919.pdf/
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    Bibliographic Info

    Paper provided by University of Copenhagen. Department of Economics in its series Discussion Papers with number 99-19.

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    Length: 37 pages
    Date of creation: Aug 1999
    Date of revision:
    Handle: RePEc:kud:kuiedp:9919

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    Related research

    Keywords: labor market policy; temporary leave; parental leave; sabbatical; education; unemployment; search;

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