Active labour market policy vs employment tax credits: lessons from recent UK reforms
Many welfare-to-work programs in both North America and Europe are directed at making work pay for the low skilled. This paper identifies two alternative policies that are motivated by this same objective – active labour market programs that involve wage subsidies together with improved job matching; and earned income tax credits that supplement wages for working low-income families. Although sharing similar concerns over labour market incentives for low skilled workers, these alternative policies typically differ in many important ways. We present an evaluation of the impacts of two such recent programs designed to enhance the labour market attachment of low-wage workers in the UK. These programs have many features in common and are similar to many policy proposals in Europe and North America. The evaluation of the UK reforms brings empirical evidence into the debate on the effectiveness of these programs and is used to assess what aspects of their design work well and what aspects could be improved.
|Date of creation:||15 Jan 2002|
|Date of revision:|
|Publication status:||Published in Swedish Economic Policy Review, 2001, pages 239-266.|
|Contact details of provider:|| Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden|
Phone: (+46) 18 - 471 70 70
Fax: (+46) 18 - 471 70 71
Web page: http://www.ifau.se/
More information through EDIRC
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.:
- Richard Blundell & Thomas MaCurdy, 1998.
"Labour supply: a review of alternative approaches,"
IFS Working Papers
W98/18, Institute for Fiscal Studies.
- Richard Blundell & Hilary W. Hoynes, 2004.
"Has 'In-Work' Benefit Reform Helped the Labor Market?,"
in: Seeking a Premier Economy: The Economic Effects of British Economic Reforms, 1980-2000, pages 411-460
National Bureau of Economic Research, Inc.
- Hilary Hoynes & Richard Blundell, 2001. "Has "In-Work" Benefit Reform Helped the Labour Market?," NBER Working Papers 8546, National Bureau of Economic Research, Inc.
- Richard Blundell & Monica Costa Dias, 2000. "Evaluation methods for non-experimental data," Fiscal Studies, Institute for Fiscal Studies, vol. 21(4), pages 427-468, January.
- Jeffrey Grogger, 2004.
"Time Limits and Welfare Use,"
Journal of Human Resources,
University of Wisconsin Press, vol. 39(2).
- Keane, Michael & Moffitt, Robert, 1998.
"A Structural Model of Multiple Welfare Program Participation and Labor Supply,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 39(3), pages 553-89, August.
- Michael P. Keane & Robert A. Moffitt, 1995. "A structural model of multiple welfare program participation and labor supply," Working Papers 557, Federal Reserve Bank of Minneapolis.
- M. Keane & R. Moffitt, . "A structural model of multiple welfare program participation and labor supply," Institute for Research on Poverty Discussion Papers 1080-96, University of Wisconsin Institute for Research on Poverty.
- M. Keane & R. Mofitt, 1995. "A Structural Model of Multiple Welfare Program Participation and Labor Supply," Working Papers 95-4, Brown University, Department of Economics.
- Jeff Grogger & Charles Michalopoulos, 2000.
"Welfare Dynamics under Time Limits,"
JCPR Working Papers
125, Northwestern University/University of Chicago Joint Center for Poverty Research.
When requesting a correction, please mention this item's handle: RePEc:hhs:ifauwp:2002_001. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Monica Fällgren)
If references are entirely missing, you can add them using this form.