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Interdependence in a Tripartite Labor Market Model

A labor market model is built on three pillars: 1) flexible hiring and firing rules for employers, 2) generous income support for the unemployed, and 3) active policies to help the unemployed find new jobs. Explain why the first two pillars (flexibility and income support) would be difficult to sustain economically and socially without the third pillar (active policies).

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Updated 2025-08-14

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