This paper analyses theoretically and empirically how employment subsidies should betargeted. We contrast measures involving targeting workers with low incomes/abilities andtargeting the unemployed under the criteria of "approximate welfare efficiency" (AWE)...

In light of nonstationary search theory (van den Berg, 1990), this paper estimates the effectsof benefit entitlement periods and the size of unemployment benefits on unemploymentdurations and post-unemployment earnings in West Germany...