This line of research is devoted to the question: How to redistribute income in current economies characterized by the presence of unemployment, endogenous wages and decisions to participate or not to the (formal) labour market ? The aim is to characterize the tax function that optimizes a given social welfare criterion. An important channel is the impact of the tax schedule on wages and hence on labour demand. This impact is studied from theoretical and empirical perspectives.
The design of unemployment insurance includes the level and the timing of unemployment benefits, the design of the monitoring of job-search behavior and the level of assistance benefits when unemployment insurance is exhausted. These topics are studiend with Juliana Mésen Vargas, B. Cockx, M. Dejemeppe and A. Launov
In the analysis of the causes of the rise and the persistence of unemployment/non-formal employment, the following research themes are or have recently been developed:
In the evaluation studies much effort is devoted to the correction for "selection bias" induced by characteristics that the researcher does not observe. Current and projects deal with (i) the impact of monitoring and counselling programmes for the unemployed; (ii) the evaluation of labor market policies that intend to keep ''old workers'' employed; (iii) the impacts of changes in unemployment insurance. These topics are studied with B. Cockx, M. Dejemeppe, Koen Declercq and A. Launov.
Earlier research focussed on marcoeconometric evaluation of labour market policies (See e.g. Dor et al, Oxford Bulletin of Economics and Statistics, 1997, and Van der Linden and Dor, 2000). More recently (calibrated) general equilibrium models with frictions have been used to evaluate the role of labour market policies such as the profile of unemployment benefits, training programs for the unemployed and reductions in social security contributions (Van der Linden, 2002, 2003a,2003b,2003c, 2005, the IZA discussion paper 2073 and the paper published with Gabriele Cardullo in 2007).