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Nezaměstnanost a pracovní pobídky
[Unemployment and work incentives]

Author

Listed:
  • Tomáš Sirovátka
  • Martin Žižlavský

Abstract

In this paper we explore how unemployment benefits and other social benefits affect work incentives in the Czech Republic. We test the link between replacement rates and reservation wages taking duration of unemployment into account and we specify validity of the outlined model using replacement rates and reservation wages recognised in the sample of the unemployed. We conclude that replacement rates are high only in case of specific family types (incomplete families and families with children where women have lost the job), low skilled categories of the unemployed. Reservation wages are linked mainly to the economic and social status of the unemployed and seem to be raised by replacement rates of benefits only with the category of the unskilled. Besides low efficiency of job search, insecurity of job tenure and insecurity of future benefits entitlements raise the price of the status of the unemployed and push reservation wages up.

Suggested Citation

  • Tomáš Sirovátka & Martin Žižlavský, 2003. "Nezaměstnanost a pracovní pobídky [Unemployment and work incentives]," Politická ekonomie, Prague University of Economics and Business, vol. 2003(3).
    • Handle: RePEc:prg:jnlpol:v:2003:y:2003:i:3:id:409
    DOI: 10.18267/j.polek.409
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    More about this item

    Keywords

    replacement rate; reservation wage; work incentives;
    All these keywords.

    JEL classification:

    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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