Testing Search Theory with Reemployment Bonus Experiments: Cross-Validation of Results from New Jersey and Illinois
AbstractThis paper assesses the ability of a simple search-theoretic model to explain the results of two controlled reemployment bonus experiments. The availability of two independent experiments with substantially different treatments allows for a rigorous test of the model. Parameters of the model are estimated by minimizing the distance between the observed and predicted aggregate response in each experiment, then cross-validated using the observed and predicted treatment response from the other experiment. The model provides qualitative predictions that match the observed results quite well, but is unable to predict an effect as large as that observed in one of the experiments.
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Bibliographic InfoArticle provided by Eastern Economic Association in its journal Eastern Economic Journal.
Volume (Year): 19 (1993)
Issue (Month): 2 (Spring)
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Find related papers by JEL classification:
- J64 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment: Models, Duration, Incidence, and Job Search
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Woodbury, Stephen A & Spiegelman, Robert G, 1987. "Bonuses to Workers and Employers to Reduce Unemployment: Randomized Trials in Illinois," American Economic Review, American Economic Association, vol. 77(4), pages 513-30, September.
- Lawrence F. Katz, 1986. "Layoffs, Recall and the Duration of Unemployment," NBER Working Papers 1825, National Bureau of Economic Research, Inc.
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