Abstract

http://ssrn.com/abstract=394280
 
 

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European Economic Integration and the Effectiveness of Employment Policies


K. C. Fung


University of California at Santa Cruz

Chelsea Lin


National Dong Hwa University

Andrea Maechler


University of California, Santa Cruz - Department of Economics

March 20, 2003


Abstract:     
This paper examines the qualitative impact and the degree of effectiveness of several labor market policies when domestic union's wage response and economic integration are explicitly taken into account. The employment policies considered include payroll tax cuts, unemployment benefits cuts, aggregate demand expansion and wage subsidies. It is shown that with endogenous wages and an open economy, these policies can in some cases become more potent. But in other instances, they become less effective. In fact, under some conditions derived in this paper, employment policies can even be counterproductive, leading to a drop in domestic employment.

Number of Pages in PDF File: 24

Keywords: European unemployment, economic integration, labor market structure

JEL Classification: F15, F42, L51

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Date posted: May 27, 2003  

Suggested Citation

Fung, K. C. and Lin, Chelsea and Maechler, Andrea, European Economic Integration and the Effectiveness of Employment Policies (March 20, 2003). UC Santa Cruz Economics Working Paper No. 03-5. Available at SSRN: http://ssrn.com/abstract=394280

Contact Information

K.C. Fung (Contact Author)
University of California at Santa Cruz ( email )
Santa Cruz, CA 95064
United States
831-459-3273 (Phone)
831-459-5900 (Fax)
Chelsea Lin
National Dong Hwa University
No. 1, Sec. 2, Da Hsueh Rd.
Shoufeng, Hualien 97401
Taiwan
China
Andrea Maechler
University of California, Santa Cruz - Department of Economics ( email )
Santa Cruz, CA 95064
United States
831-495-5201 (Phone)
831-495-5900 (Fax)
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