Question: Problem Set Maternity Benefits Consider a maternity benefit program that provides payments to mothers who take time off after the birth of a child. Assume


Problem Set Maternity Benefits Consider a maternity benefit program that provides payments to mothers who take time off after the birth of a child. Assume the following for the first three questions in this problem set: . There are two types of workers: o CB (child-bearing) workers are eligible and claim maternity benefits with probability probce o NCB (non-child-bearing) workers who are not eligible for maternity benefits (because they will never give birth). CB workers who give birth receive a benefit of v 1. Suppose that the government requires firms to provide maternity benefits to mothers that they employ. How would you expect this maternity benefit program to affect the following outcomes in firms that hire only CB workers? Illustrate your answers using one or more clearly labeled diagrams. a) the level of employment b) the wage received by workers c) the cost of labour to firms d) the total value of compensation received by workers e) the total amount of the tax received or subsidy paid 2. Suppose that the government requires firms to provide maternity benefits to mothers that they employ. How would you expect this maternity benefit program to affect the following outcomes in firms that hire only NCB workers? Illustrate your answers using one or more clearly labeled diagrams. a) the level of employment b) the wage received by workers c) the cost of labour to firms d) the total value of compensation received by workers e) the total amount of the tax received or subsidy paid
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