The paper examines social security (public pension) reforms in which the programme is partially shifted from a public unfunded basis to a private, prefunded, basis. It focuses on reforms where individuals have a choice in switching from public funded to private unfunded programmes (as in the ‘contracting out’ scheme in the UK), or where some individuals are forced to join the funded scheme, or ...

We provide a lifecycle framework for comparing the insurance value of disability benefits and the incentive cost. We estimate the risks that individuals face and the parameters governing the disability insurance program using longitudinal US data on consumption, health, disability insurance, and wages. We characterize the economic effects of disability insurance and study how policy reforms imp...

Public-works programs in developing countries have recently attracted a lot of attention as anti-poverty initiatives. This paper analyzes the labor-market impacts of the largest public-works program in the world, the Indian NREGS, using information about its rollout in a regression-discontinuity design. The results suggest that the overall employment and casual wage impacts are small, although ...

Income Inequality, Mobility, and the Welfare State: A Political Economy Model In this paper, we set up a three-period stochastic overlapping generations model to analyze the implications of income inequality and mobility for demand for redistribution and social insurance. We model the size of two different public programs under the welfare state. We investigate bidimensional voting on the tax r...

The New Deal for Young People (NDYP) is one of the main components of the UK government’s Welfare-to-Work strategy aimed at raising employment and reducing benefit dependency. It combines elements of an active labour market programme with a stricter benefit regime. This paper evaluates its impact on the wider economy, emphasising the importance of the programme’s effect on wage pressure, which ...

The impact of a stronger work requirement for welfare recipients in a workfare program is studied in an efficiency wage model where a representative firm chooses its level of monitoring activities. A stricter workfare policy raises employment and monitoring activities. It typically increases profits and reduces the tax rate. The impact on the net wage is ambiguous. Utility levels of employed wo...

Labor Market Impacts of a Large-Scale Public Works Program: Evidence from the Indian Employment Guarantee Scheme Recent years have seen an increasing interest in using public-works programs as antipoverty measures in developing countries. This paper analyzes the rural labor market impacts of the Indian National Rural Employment Guarantee Scheme, one of the most ambitious programs of its kind, b...