LABOR-MARKET POLICY AND THE UNEMPLOYED IN HUNGARY

We investigate passive and active labour market policy towards the Hun garian unemployed using large samples of microdata. First, we consider the income support role of unemployment benefits showing how coverage of unemployed searchers by different benefits and UI replacement rate s have changed over 1992-94. Second, we analyse disincentive effects o f UI non-parametrically, exploiting a 'natural experiment' provided by a major change in rules applied only to new claims. Third, we use a p arametric model to comment on the degree to which active labour market schemes are targeted on those who find it hardest to get jobs.