Hiring subsidies, job creation and job destruction

Sagiri Kitao, Ayşegül Şahin, Joseph Song

Research output: Contribution to journalArticlepeer-review

4 Citations (Scopus)

Abstract

We quantify the effects of hiring subsidies using the model of Mortensen and Pissarides (2003). The job creation effect can be large in a weak labor market. However, in the long-run, subsidies raise the wage and equilibrium unemployment.

Original languageEnglish
Pages (from-to)248-251
Number of pages4
JournalEconomics Letters
Volume113
Issue number3
DOIs
Publication statusPublished - 2011 Dec 1

Keywords

  • Employment
  • Hiring subsidy
  • Unemployment

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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