How to Improve Back-to-Work Incentives?

Résumé 0

We analyze back-to-work incentives taking into account inter-temporal gains and worker mobility between jobs. Theoretically, we show that these incentives vary depending on the difference between replacement benefits and bad jobs wages. They are also sensitive to the accessibility and stability of good jobs and to the wage inequality between good and bad jobs. The fact is, all these factors vary among social groups. Given this kind of diversity, we present an illustrative simulation based on a French Labor Force Survey, which suggests that mixing policies is the best way to improve back-to-work incentives. For instance, if one has to make jobs more stable for unskilled young men, it is better to improve accessibility to good jobs for young women graduates or for unskilled intermediate-age adults, or we need to use all resources for young unskilled women. Classification JEL:H31, H53, I38, J22, J64