BY: WOLFGANG OCHEL
IFO Institute, Germany
Institute for Economic Research
CESifo (Center for Economic Studies and Ifo
Institute for Economic Research)
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Paper ID: CESifo Working Paper No. 537
Date: August 2001
Contact: WOLFGANG OCHEL
Email: Mailto:Ochel at ifo.de
Postal: IFO Institute, Germany
Institute for Economic Research
Poschinger Str. 5
81679 Munich, GERMANY
ABSTRACT:
Social assistance in Germany reduces the incentive to work. The
U. S. Welfare to Work Programme tries to avoid such
disincentives. It consists essentially of two elements: the
Earned Income Tax Credit (EITC) for employees in low wage
occupations and a Workfare model. The EITC and the Workfare
model as implemented in the State of Wisconsin are described and
analysed. Conclusions for welfare reform in Germany are drawn.