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To Work or Not to Work? Effects of Temporary Public Employment on Future Employment and Benefits

Author

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  • Mörk, Eva

    (Uppsala University)

  • Ottosson, Lillit

    (Uppsala University)

  • Vikman, Ulrika

    (IFAU)

Abstract

We evaluate a temporary public sector employment program targeted at individuals with weak labor market attachment, applying dynamic inverse probability weighting to account for dynamic selection. We show that the program is successful in increasing employment and reducing social assistance. However, being at a regular workplace seems crucial: we find negative employment effects for participants employed at a workplace created especially for the purpose. The decrease in social assistance is to some extent countered by an increase in the share receiving unemployment insurance benefits, indicating that municipalities are able to shift costs from the local to the central budget.

Suggested Citation

  • Mörk, Eva & Ottosson, Lillit & Vikman, Ulrika, 2022. "To Work or Not to Work? Effects of Temporary Public Employment on Future Employment and Benefits," IZA Discussion Papers 15071, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp15071
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    Cited by:

    1. Jeremias Nieminen & Ohto Kanninen & Hannu Karhunen, 2023. "The decentralization of public employment services and local governments’ responses to incentives," Journal of Economic Geography, Oxford University Press, vol. 23(6), pages 1371-1395.
    2. Ohto Kanninen & Hannu Karhunen & Jeremias Nieminen, "undated". "Effect of Secondary Education on Cognitive and Non-cognitive Skills," Working Papers 337, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.
    3. Bastiaans, Mareen & Dur, Robert & Gielen, Anne C., 2023. "Activating the Long-Term Inactive: Labor Market and Mental Health Effects," IZA Discussion Papers 15891, Institute of Labor Economics (IZA).
    4. Aronsson, Thomas & Bastani, Spencer & Tayibov, Khayyam, 2021. "Social Exclusion and Optimal Redistribution," Umeå Economic Studies 1004, Umeå University, Department of Economics.

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    More about this item

    Keywords

    public sector employment programs; social assistance; cost-shifting; dynamic inverse probability weighting;
    All these keywords.

    JEL classification:

    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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