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Abstract ▼ AI-Helper

This paper examines the effect of employment subsidies on the employment of people with disabilities by private firms. Unlike previous studies, we specify the private firms' employment decisions by the motivation behind their employment of disabled people, based on the unique survey by the Employmen...

This paper examines the effect of employment subsidies on the employment of people with disabilities by private firms. Unlike previous studies, we specify the private firms' employment decisions by the motivation behind their employment of disabled people, based on the unique survey by the Employment Development Institute. Moreover, we present and discuss the results in detail using marginal effect analysis, which alleviates the difficulties in interpreting the results of non-linear models. Our findings suggest that subsidies significantly increase the probability of employment of disabled people in private firms with more than 100 employees, while the effect is rather limited in firms with fewer employees. The results imply that the current incentive system may not be sufficient to achieve the socially desirable level of employment of disabled people.

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