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Estimating equilibrium effects of job search assistance

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  • Gautier, Pieter A
  • Muller, Paul
  • Rosholm, Michael
  • Svarer, Michael
  • van der Klaauw, Bas

Abstract

Randomized experiments provide policy relevant treatment effects if there are no spillovers between participants and nonparticipants. We show that this assumption is violated for a Danish activation program for unemployed workers. Using a difference-in-difference model we show that the nonparticipants in the experiment regions find jobs slower after the introduction of the activation program (relative to workers in other regions). We then estimate an equilibrium search model. This model shows that a large scale role out of the activation program decreases welfare, while a standard partial microeconometric cost-benefit analysis would conclude the opposite.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 9066.

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Date of creation: Jul 2012
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Handle: RePEc:cpr:ceprdp:9066

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Keywords: externalities; indirect inference; job search; policy-relevant treatment effects; randomized experiment;

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References

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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. How randomized experiments can go very wrong
    by Economic Logician in Economic Logic on 2012-12-19 15:05:00
  2. [??]??????????????????
    by himaginary in himaginaryの日記 on 2013-01-11 08:00:00
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Cited by:
  1. Blasco, Sylvie & Pertold-Gebicka, Barbara, 2013. "Employment policies, hiring practices and firm performance," Labour Economics, Elsevier, vol. 25(C), pages 12-24.
  2. van der Klaauw, Bas, 2014. "From Micro Data to Causality: Forty Years of Empirical Labor Economics," IZA Discussion Papers 8047, Institute for the Study of Labor (IZA).
  3. Fuhito Kojima & Parag A. Pathak & Alvin E. Roth, 2010. "Matching with Couples: Stability and Incentives in Large Markets," NBER Working Papers 16028, National Bureau of Economic Research, Inc.
  4. Boockmann, Bernhard & Osiander, Christopher & Stops, Michael & Verbeek, Hans, 2013. "Effekte von Vermittlerhandeln und Vermittlerstrategien im SGB II und SGB III (Pilotstudie) : Abschlussbericht an das IAB durch das Institut für Angewandte Wirtschaftsforschung e. V. (IAW), Tübingen," IAB-Forschungsbericht 201307, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  5. Vikström, Johan & Rosholm, Michael & Svarer, Michael, 2013. "The effectiveness of active labor market policies: Evidence from a social experiment using non-parametric bounds," Labour Economics, Elsevier, vol. 24(C), pages 58-67.

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