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Non-profit provision of job training and mediation services; an empirical analysis using contract data of job training service providers

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  • Pierre Koning

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Abstract

This paper analyses the relative performance and selection behaviour of not-for-profit (NFP) job training service providers, using contract data from the Dutch social benefit administration. Our analysis takes full account of selection effects, both ex ante (before the contracting process) as well as ex post (at the start of the program). First, for each cohort type of unemployed clients, cohorts that are contracted are ex ante equivalent for providers that are procured. Thus, within cohort type variation in performance outcomes suffices to obtain consistent estimates of performance differentials. Second, ex post selection of clients by providers, at the start of programs, is measured explicitly in our data. Our estimation results show that FPs are more active in selecting clients, both by sending back more of them, and indirectly, by encouraging clients to start a program, so as to receive additional (fixed) payments by the social benefit administration (per client at the start of a program). Regarding the estimation results for the job placement rates, we find NFP job training service providers only to outperform FPs slightly in the durability of job contracts. This effect is however too small to lead to overall better placement rates.

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Bibliographic Info

Paper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Discussion Paper with number 94.

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Date of creation: Dec 2007
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Handle: RePEc:cpb:discus:94

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  1. James J. Heckman & Carolyn Heinrich & Jeffrey Smith, 2002. "The Performance of Performance Standards," Journal of Human Resources, University of Wisconsin Press, vol. 37(4), pages 778-811.
  2. Pierre Koning & Joƫlle Noailly & Sabine Visser, 2007. "Do Not-For-Profits Make a Difference in Social Services? A Survey Study," De Economist, Springer, vol. 155(3), pages 251-270, September.
  3. Carolyn J. Heinrich, 2000. "Organizational form and performance: An empirical investigation of nonprofit and for-profit job-training service providers," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 19(2), pages 233-261.
  4. Francois, Patrick, 2000. "'Public service motivation' as an argument for government provision," Journal of Public Economics, Elsevier, vol. 78(3), pages 275-299, November.
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Cited by:
  1. Koning, Pierre & Heinrich, Carolyn J., 2010. "Cream-Skimming, Parking and Other Intended and Unintended Effects of Performance-Based Contracting in Social Welfare Services," IZA Discussion Papers 4801, Institute for the Study of Labor (IZA).

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