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Benefit Take-Up and Labor Supply Incentives of Interdependent Means-Tested Benefit Programs for Low-Income Households

  • Kerstin Bruckmeier
  • Jürgen Wiemers
Article
  • 6 Downloads

Abstract

Using a microsimulation model based on representative panel data, we analyze the outcomes of three major means-tested interdependent benefit programs that are available for low-income households in Germany with respect to benefit take-up and labor supply incentives. The results show a distinct overlap between the programs and high rates of non-take-up, indicating that the effectiveness of the programs in reaching their target groups could be improved. Furthermore, we find that workers from low-income households are confronted with a complex benefit structure and high marginal tax rates, which negatively affects the individual labor supply.

Keywords

Social assistance Labor supply Non-take-up Microsimulation 

JEL Classification

I38 H31 C15 

Notes

Acknowledgements

We thank the editor and two anonymous referees for helpful comments.

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Copyright information

© Association for Comparative Economic Studies 2018

Authors and Affiliations

  1. 1.Institute for Employment Research (IAB) of the German Federal Employment Agency (BA)NurembergGermany

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