We analyse a model in which families may either be 'traditional' single-earner with caring for the child at home or 'modern' double-earner households using market child care. Family policies may favour either the one or the other group, like market care subsidies vs. cash for care. Policies are...

I investigate causal machine learning (CML) methods to estimate effect heterogeneity by means of conditional average treatment effects (CATEs). In particular, I study whether the estimated effect heterogeneity can provide evidence for the theoretical labour supply predictions of Connecticut's...

Our very simple two agent New Keynesian model is highly stylised. It consists of an entrepreneur, who owns the economies' firms, consumes and saves, but does not work (or does not receive wage income), while the worker consumes and works, but cannot save. The allocation of the ability to save...

We show that the distributional consequences of fiscal consolidations depend significantly on the level of private indebtedness. Austerity leads to a strong and persistent increase in income inequality when private debt is high. In contrast, there are no discernible distributional effects when...

The aim of the paper is to examine the consequences of displacement on unemployment duration. Due to ex-ante asymmetric information about the productivity of unemployed applicants, prospective employers use the type of displacement as a costless signal about the ability of the worker when making...

We develop and empirically test a labor market model with Public Employment Agencies (PEA) in order to understand why not all vacancies use the costless services provided by the PEA. We show that both the search market and the PEA can be active in equilibrium. In such an equilibrium, workers...

Sequences of active labour market programmes (ALMPs) may be part of an intensified activation strategy targeting hard-to-place individuals who may be long-term unemployed and who may encounter extreme difficulty in finding jobs. Such sequences are very common among welfare recipients in Germany,...

In this paper we analyze the effects on the welfare of heterogeneous native workers in the context of the presence of legal and illegal immigrants, and where the main instrument of economic policy takes the form of entry quotas. In the framework of a model of overlapping generations, we find...