Fiscal policy and the labour market: An AGE analysis

This paper analyses the impact of fiscal policy on the labour market by using an applied general equilibrium model for The Netherlands, called MIMIC. In particular, we explore the economic effects of changes in the tax system that currently receive much attention in the Dutch policy debate including, lower marginal tax rates, reductions in social premiums paid by employers targeted at the unskilled, vouchers for long-term unemployed, and earned income tax credits.