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Is the Notification of Monitoring a Threat to the Unemployed? A Regression Discontinuity Approach

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  • Bart Cockx
  • Muriel Dejemeppe

Abstract

In July 2004, the Belgian government intensified monitoring within the Unemployment Insurance scheme. Workers claiming unemployment benefits for more than 13 months are notified that past job-search behavior will be monitored 8 months later. In one region the target group is counselled shortly after the notification, while in others not or only once the monitoring has taken place. We exploit the discontinuity in the treatment assignment at the age of 30 to evaluate the threat effect of the notification on the probability of employment. We find that the effect is heterogeneous and critically depends on whether and when notified workers are counselled.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2007/wp-cesifo-2007-07/cesifo1_wp2042.pdf
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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2042.

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Date of creation: 2007
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Handle: RePEc:ces:ceswps:_2042

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Keywords: evaluation; monitoring job-search; threat effect; regression-discontinuity;

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References

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  1. Blundell, Richard William & Costa Dias, Monica & Meghir, Costas & Van Reenen, John, 2003. "Evaluating the Employment Impact of a Mandatory Job Search Programme," CEPR Discussion Papers 3786, C.E.P.R. Discussion Papers.
  2. Cees Gorter & Guyonne R. J. Kalb, 1996. "Estimating the Effect of Counseling and Monitoring the Unemployed Using a Job Search Model," Journal of Human Resources, University of Wisconsin Press, vol. 31(3), pages 590-610.
  3. Ashenfelter, Orley & Ashmore, David & Deschenes, Olivier, 2005. "Do unemployment insurance recipients actively seek work? Evidence from randomized trials in four U.S. States," Journal of Econometrics, Elsevier, vol. 125(1-2), pages 53-75.
  4. Peter Fredriksson & Bertil Holmlund, 2003. "Improving Incentives in Unemployment Insurance: A Review of Recent Research," CESifo Working Paper Series 922, CESifo Group Munich.
  5. Lemieux, Thomas & Milligan, Kevin, 2008. "Incentive effects of social assistance: A regression discontinuity approach," Journal of Econometrics, Elsevier, vol. 142(2), pages 807-828, February.
  6. Dan A. Black & Jeffrey A. Smith & Mark C. Berger & Brett J. Noel, 2003. "Is the Threat of Reemployment Services More Effective Than the Services Themselves? Evidence from Random Assignment in the UI System," American Economic Review, American Economic Association, vol. 93(4), pages 1313-1327, September.
  7. Lars Pico Geerdsen, 2006. "Is there a Threat Effect of Labour Market Programmes? A Study of ALMP in the Danish UI System," Economic Journal, Royal Economic Society, vol. 116(513), pages 738-750, 07.
  8. Jaap H. Abbring & Gerard J. Berg & Jan C. Ours, 2005. "The Effect of Unemployment Insurance Sanctions on the Transition Rate from Unemployment to Employment," Economic Journal, Royal Economic Society, vol. 115(505), pages 602-630, 07.
  9. Graversen, B.K. & Ours, J.C. van, 2006. "How to Help Unemployed Find Jobs Quickly: Experimental Evidence from a Mandatory Activation Program," Discussion Paper 2006-126, Tilburg University, Center for Economic Research.
  10. Bruno, CREPON & Muriel, DEJEMEPPE & Marc, GURGAND, 2005. "Counseling the unemployed : does it lower unemployment duration and recurrence ?," Discussion Papers (ECON - Département des Sciences Economiques) 2005034, Université catholique de Louvain, Département des Sciences Economiques.
  11. Lee, David S. & Card, David, 2008. "Regression discontinuity inference with specification error," Journal of Econometrics, Elsevier, vol. 142(2), pages 655-674, February.
  12. Boone, Jan & Fredriksson, Peter & Holmlund, Bertil & van Ours, Jan, 2001. "Optimal Unemployment Insurance with Monitoring and Sanctions," Working Paper Series 2001:20, Uppsala University, Department of Economics.
  13. Edwin Leuven & Hessel Oosterbeek, 2004. "Evaluating the Effect of Tax Deductions on Training," Journal of Labor Economics, University of Chicago Press, vol. 22(2), pages 461-488, April.
  14. Bart Cockx & Jean Ries, 2004. "The Exhaustion of Unemployment Benefits in Belgium. Does it Enhance the Probability of Employment?," CESifo Working Paper Series 1226, CESifo Group Munich.
  15. Wooldridge, Jeffrey M., 1997. "On two stage least squares estimation of the average treatment effect in a random coefficient model," Economics Letters, Elsevier, vol. 56(2), pages 129-133, October.
  16. Justin McCrary, 2007. "Manipulation of the Running Variable in the Regression Discontinuity Design: A Density Test," NBER Technical Working Papers 0334, National Bureau of Economic Research, Inc.
  17. Geerdsen, Lars Pico & Holm, Anders, 2007. "Duration of UI periods and the perceived threat effect from labour market programmes," Labour Economics, Elsevier, vol. 14(3), pages 639-652, June.
  18. Martin, John P. & Grubb, David, 2001. "What works and for whom: a review of OECD countries' experiences with active labour market policies," Working Paper Series 2001:14, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  19. Forslund, Anders & Nordström Skans, Oskar, 2006. "Swedish youth labour market policies revisited," Working Paper Series 2006:6, IFAU - Institute for Evaluation of Labour Market and Education Policy.
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Citations

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Cited by:
  1. Michael Svarer, 2007. "The Effect of Sanctions on the Job Finding Rate: Evidence from Denmark," Economics Working Papers 2007-10, School of Economics and Management, University of Aarhus.
  2. Jonas Maibom Pedersen & Michael Rosholm & Michael Svarer, 2012. "Experimental Evidence on the Effects of Early Meetings and Activation," Economics Working Papers 2012-26, School of Economics and Management, University of Aarhus.
  3. McGuinness, Seamus & O'Connell, Philip J. & Kelly, Elish & Walsh, John R., 2011. "Activation in Ireland: An Evaluation of the National Employment Action Plan," Research Series, Economic and Social Research Institute (ESRI), number RS20.
  4. Rosholm, Michael, 2008. "Experimental Evidence on the Nature of the Danish Employment Miracle," IZA Discussion Papers 3620, Institute for the Study of Labor (IZA).
  5. Michèle Belot & Vincent Vandenberghe, 2014. "Evaluating the 'threat' effects of grade repetition: exploiting the 2001 reform by the French-Speaking Community of Belgium," Education Economics, Taylor & Francis Journals, vol. 22(1), pages 73-89, February.
  6. Kelly, Elish & McGuinness, Seamus & O'Connell, Philip J., 2011. "What Can Active Labour Market Policies Do?," Papers EC1, Economic and Social Research Institute (ESRI).
  7. Bas, Maria & Ledezma, Ivan, 2007. "Market Access and the Evolution of within Plant Productivity in Chile," Economics Papers from University Paris Dauphine 123456789/6913, Paris Dauphine University.
  8. Seamus McGuinness & Philip J. O’Connell & Elish Kelly, 2013. "Carrots, No Stick, No Driver: The Employment Impact of Job Search Assistance in a Regime with Minimal Monitoring and Sanctions," Working Papers 201308, Geary Institute, University College Dublin.
  9. Muriel Dejemeppe & Bruno Van der Linden & Andrey Launov & Bart Cockx, 2011. "Monitoring and Sanctions in a Non-Stationary Structural Job-Search Model," 2011 Meeting Papers 501, Society for Economic Dynamics.
  10. Cockx, Bart & Dejemeppe, Muriel, 2012. "Monitoring job search effort: An evaluation based on a regression discontinuity design," Labour Economics, Elsevier, vol. 19(5), pages 729-737.
  11. McGuinness, Seamus & O'Connell, Philip J. & Kelly, Elish, 2011. "Carrots without Sticks: The Impacts of Job Search Assistance in a Regime with Minimal Monitoring and Sanctions," Papers WP409, Economic and Social Research Institute (ESRI).

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