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Employment Outcomes in the Welfare State

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  • Chris Pissarides

    (London School of Economics)

Abstract

We examine the implications of tax and subsidy policies for employment in the "three worlds of welfare", Anglo-Saxon, Continental European and Scandinavian. We argue that home production is key to a proper evaluation of the employment outcomes. Anglo-Saxon low-support policies encourage more overall market employment. Continental transfer polilcies encourage more home production in services with close substitutes at home. Scandinavian policies give incentives to move home production in social services to the market but discourage other service activity. We find support for our claims in sectoral employment data for five representative countries, United States, Britain, France, Italy and Sweden.

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Bibliographic Info

Paper provided by Society for Economic Dynamics in its series 2008 Meeting Papers with number 1096.

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Date of creation: 2008
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Handle: RePEc:red:sed008:1096

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  1. L. Rachel Ngai & Christopher Pissarides, 2005. "Structural change in a multi-sector model of growth," LSE Research Online Documents on Economics 4656, London School of Economics and Political Science, LSE Library.
  2. Richard B. Freeman & Ronald Schettkat, 2005. "Marketization of household production and the EU-US gap in work," Economic Policy, CEPR & CES & MSH, vol. 20(41), pages 6-50, 01.
  3. Richard Rogerson, 2007. "Taxation and market work: is Scandinavia an outlier?," Economic Theory, Springer, vol. 32(1), pages 59-85, July.
  4. Giuseppe Bertola & Francine Blau & Lawrence Kahn, 2007. "Labor market institutions and demographic employment patterns," Journal of Population Economics, Springer, vol. 20(4), pages 833-867, October.
  5. Esping-Andersen, Gosta, 1999. "Social Foundations of Postindustrial Economies," OUP Catalogue, Oxford University Press, number 9780198742005, September.
  6. Giulia Faggio & Stephen Nickell, 2006. "Patterns of work across the OECD," LSE Research Online Documents on Economics 19853, London School of Economics and Political Science, LSE Library.
  7. Edward C. Prescott, 2003. "Why do Americans work so much more than Europeans?," Staff Report 321, Federal Reserve Bank of Minneapolis.
  8. Olivier Blanchard, 2005. "European Unemployment: The Evolution of Facts and Ideas," NBER Working Papers 11750, National Bureau of Economic Research, Inc.
  9. Assar Lindbeck, 1997. "The Swedish Experiment," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1273-1319, September.
  10. Francesco Daveri & Guido Tabellini, 2000. "Unemployment, growth and taxation in industrial countries," Economic Policy, CEPR & CES & MSH, vol. 15(30), pages 47-104, 04.
  11. Assar Lindbeck, 1988. "Consequences of the Advanced Welfare State," The World Economy, Wiley Blackwell, vol. 11(1), pages 19-38, 03.
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Cited by:
  1. Niko Matouschek & P Ramezzana & Frédéric Robert-Nicoud, 2008. "Labor Market Reforms, Job Instability, and the Flexibility of the Employment Relationship," CEP Discussion Papers dp0865, Centre for Economic Performance, LSE.
  2. L. Rachel Ngai & Roberto M. Samaniego, 2008. "Mapping prices into productivity in multisector growth models," LSE Research Online Documents on Economics 19579, London School of Economics and Political Science, LSE Library.
  3. Urban Sila, 2009. "Can family-support policies help explain differences in working hours across countries?," LSE Research Online Documents on Economics 28684, London School of Economics and Political Science, LSE Library.
  4. Andreas Georgiadis, 2008. "Efficiency Wages and the Economic Effects of the Minimum Wage: Evidence from a Low-Wage Labour Market," CEP Discussion Papers dp0857, Centre for Economic Performance, LSE.

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