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Does Job-Search Assistance Affect Search Effort and Outcomes? A Microeconometric Analysis of Public versus Private Search Methods

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Author Info

  • Fougère, Denis

    ()
    (CREST)

  • Pradel, Jacqueline

    ()
    (University of Paris 1 Panthéon-Sorbonne)

  • Roger, Muriel

    ()
    (INRA-CORELA)

Abstract

In this paper, we examine the disincentive effects of the public employment service on the search effort of unemployed workers and on their exit rate from unemployment. For that purpose, we specify a structural search model with fixed and variable costs of search in which unemployed workers select their optimal search intensity given the exogenous arrival rate of job offers coming from the public employment agency. Because the theoretical effect of an increase in this exogenous job offer arrival rate on the structural exit rate from unemployment is ambiguous, we estimate this model using individual unemployment duration data. Our results show that the exit rate from unemployment increases with the arrival rate of job contacts obtained by the public employment service, especially for low-educated and low-skilled workers. They also show that the search effort is more costly for low-educated women and low-skilled adult unemployed workers. This last result suggests that a public employment agency that matches searchers and employers is beneficial, in the sense that it saves searchers in terms of search costs they would otherwise bear.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1825.

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Length: 54 pages
Date of creation: Oct 2005
Date of revision:
Publication status: published in: European Economic Review, 2009, 53 (7), 846-869
Handle: RePEc:iza:izadps:dp1825

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Keywords: public employment agency; search intensity; job search; simulated maximum likelihood;

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References

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Citations

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Cited by:
  1. Bergemann, Annette & van den Berg, Gerard, 2007. "Active labor market policy effects for women in Europe - a survey," Working Paper Series 2007:3, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  2. van den Berg, Gerard J. & van der Klaauw, Bas, 2013. "Structural Empirical Evaluation of Job Search Monitoring," IZA Discussion Papers 7740, Institute for the Study of Labor (IZA).
  3. Alexander Murray, 2010. "The State of Knowledge on the Role and Impact of Labour Market Information: A Survey of the International Evidence," CSLS Research Reports 2010-05, Centre for the Study of Living Standards.
  4. Biewen, Martin & Fitzenberger, Bernd & Osikominu, Aderonke & Waller, Marie, 2007. "Which Program for Whom? Evidence on the Comparative Effectiveness of Public Sponsored Training Programs in Germany," IZA Discussion Papers 2885, Institute for the Study of Labor (IZA).
  5. Kluve, Jochen, 2010. "The effectiveness of European active labor market programs," Labour Economics, Elsevier, vol. 17(6), pages 904-918, December.
  6. Setty, Ofer, 2009. "Optimal Unemployment Insurance with Monitoring," MPRA Paper 18188, University Library of Munich, Germany.
  7. Jochen Kluve, 2006. "The Effectiveness of European Active Labor Market Policy," RWI Discussion Papers 0037, Rheinisch-Westfälisches Institut für Wirtschaftsforschung.
  8. Ronald Bachmann & Daniel Baumgarten, 2012. "How Do the Unemployed Search for a Job? – Evidence from the EU Labour Force Survey," Ruhr Economic Papers 0312, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
  9. van der Klaauw, Bas & van Vuuren, Aico, 2010. "Job search and academic achievement," European Economic Review, Elsevier, vol. 54(2), pages 294-316, February.
  10. Fougère, Denis & Pradel, Jacqueline & Roger, Muriel, 2008. "Does the Public Employment Service Affect Search Effort and Outcomes?," CEPR Discussion Papers 7095, C.E.P.R. Discussion Papers.

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