search query: @author Tirole, J. / total: 37
reference: 2 / 37
| Author: | Blanchard, O.J. Tirole, J. |
| Title: | The joint design of unemployment insurance and employment protection: A first pass |
| Journal: | Journal of the European Economic Association
2008 : MAR, VOL. 6:1, p. 45-77 |
| Index terms: | unemployment insurance employment protection |
| Language: | eng |
| Abstract: | In this article, it is argued that unemployment insurance and employment protection are tightly linked. Typically, they are discussed and studied in isolation. This paper focuses on their joint optimal design in a simple model with risk-averse workers, risk-neutral firms and random shocks to productivity. The study indicates that in the "first best", unemployment insurance comes with employment protection in the form of layoff taxes. Optimality requires that layoff taxes be equal to unemployment benefits. The implications of four broad categories of deviations from first best are explored. These are limits on insurance, limits on layoff taxes, ex post wage bargaining and ex ante heterogeneity of firms or workers. |
SCIMA