of in-work benefits on search intensity, participation, employment, and unemployment, compared to a framework in which … wages are fixed. We also account for the financing of these benefits and determine the level of benefits necessary to …

its strength and weakness, discuss its connections with theory, and draw out potential policy implications of its findings …

We derive a sufficient statistics optimal tax formula in a general model that incorporates unemployment and endogenous … wages, to study the shape of the tax and transfer system at the bottom of the distribution. The sufficient statistics are … resembles a Negative Income Tax than an Earned Income Tax Credit relative to the case where unemployment and wage responses are …