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We evaluate the effects of permanently reducing labour tax rates in the euro area (EA) by simulating a large-scale open economy dynamic general equilibrium model. The model features the EA as a monetary union, split in two regions (Home and the rest of the EA - REA), the US, and the rest of the...
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producing employment growth and in reducing unemployment than most continental-European OECD-countries. It is argued that the …
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feature of the analysis is the comparison of both unemployment compensation systems in a two-country setting. It is … for economies with either an earnings-related or flatrate unemployment compensation system are considered. A distinctive … demonstrated that the performance of a system with earnings-related or flat-rate unemployment benefits depends on whether the labor …
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