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The Impact of Active Labor Market Programs and Benefit Entitlement Rules on the Duration of Unemployment

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  • Lalive, R.
  • Ours, J.C. van
  • Zweimüller, J.

    (Tilburg University, Center for Economic Research)

Abstract

Swiss policy makers created a unique link between unemployment benefits and active labor market programs (ALMPs) by making benefit payments conditional on program attendance after 7 months of unemployment duration. We evaluate the effect of ALMPs and benefit entitlement on the duration of unemployment in Switzerland. In the evaluation we allow for selectivity affecting the inflow into programs. Our results indicate that (i) after ALMP- participation the transition rate to jobs increases fro Swiss women but not for Swiss men. However, the job hazard rate is strongly reduced during participation. Taken together, this leads to the conclusion that programs prolong unemployment duration for men, but tend to shorten durations for women. (ii) once the unemployment spell approaches the expiration of unconditional benefit entitlement the job-hazard rate increases strongly, both for women and for men. (iii) there are important selectivity effects for Swiss females, but not for Swiss males.

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Bibliographic Info

Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2000-41.

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Date of creation: 2000
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Handle: RePEc:dgr:kubcen:200041

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Web page: http://center.uvt.nl

Related research

Keywords: active labor market policy; benefit entitlement; treatment effect; bivariate duration model;

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  1. Heckman, James J & Ichimura, Hidehiko & Todd, Petra E, 1997. "Matching as an Econometric Evaluation Estimator: Evidence from Evaluating a Job Training Programme," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 605-54, October.
  2. Berg, Gerard J. van den & Holm, Anders & Ours, Jan C. van, 1999. "Does work experience help to become a medical specialist?," Serie Research Memoranda 0017, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
  3. Gerfin, Michael & Lechner, Michael, 2000. "Microeconometric Evaluation of the Active Labour Market Policy in Switzerland," IZA Discussion Papers 154, Institute for the Study of Labor (IZA).
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