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The Parental Leave Benefit Reform in Germany: Costs and Labour Market Outcomes of Moving towards the Scandinavian Model

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dc.creator Spieß, Christa Katharina
dc.creator Wrohlich, Katharina
dc.date 2006
dc.date.accessioned 2013-10-16T07:00:26Z
dc.date.available 2013-10-16T07:00:26Z
dc.date.issued 2013-10-16
dc.identifier http://hdl.handle.net/10419/18523
dc.identifier ppn:519882237
dc.identifier.uri http://koha.mediu.edu.my:8181/xmlui/handle/10419/18523
dc.description Germany is known to have one of the lowest fertility rates among Western European countries and also relatively low employment rates of mothers with young children. Although these trends have been observed during the last decades, the German public has only recently begun discussing these issues. In order to reverse these trends, the German government recently passed a reform of the parental leave benefit system in line with the Scandinavian model. The core piece of the reform is the replacement of the existing means-tested parental leave benefit by a wage-dependent benefit for the period of one year. In this paper we simulate fiscal costs and expected labour market outcomes of this reform. Based on a microsimulation model for Germany we calculate first-round effects, which assume no behavioural changes and second-round effects, where we take labour supply changes into account. Our results show that on average all income groups, couples and single households, benefit from the reform. The calculation of overall costs of the reform shows that the additional costs are moderate. As far as the labour market behaviour of parents is concerned, we find no significant changes of labour market outcomes in the first year after birth. However, in the second year, mothers increase their working hours and labour market participation significantly. Our results suggest that the reform will achieve one of its aims, namely the increase in the labour market participation of mothers with young children.
dc.language eng
dc.publisher Deutsches Institut für Wirtschaftsforschung (DIW) Berlin
dc.relation DIW-Diskussionspapiere 630
dc.rights http://www.econstor.eu/dspace/Nutzungsbedingungen
dc.subject ddc:330
dc.subject female labour supply
dc.subject parental leave
dc.subject micro simulation study
dc.title The Parental Leave Benefit Reform in Germany: Costs and Labour Market Outcomes of Moving towards the Scandinavian Model
dc.type doc-type:workingPaper


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