Curbing Cream-Skimming: Evidence on Enrolment Incentives
AbstractCan enrolment incentives reduce the incidence of cream-skimming in the delivery of public sector services (e.g. education, health, job training)? In the context of a large government job training program, we investigate whether the use of enrolment incentives that set different 'shadow prices' for serving different demographic subgroups of clients, influence case workers' choice of intake population. Exploiting exogenous variation in these shadow prices, we show that training agencies change the composition of their enrollee populations in response to changes in the incentives, increasing the relative fraction of subgroups whose shadow prices increase. We also show that the increase is due to training agencies enrolling at the margin weaker members, in terms of performance, of that subgroup.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3909.
Length: 50 pages
Date of creation: Dec 2008
Date of revision:
Publication status: published in: Labour Economics, 2011, 18 (5), 643-655
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Other versions of this item:
- Courty, Pascal & Kim, Do Han & Marschke, Gerald, 2011. "Curbing cream-skimming: Evidence on enrolment incentives," Labour Economics, Elsevier, vol. 18(5), pages 643-655, October.
- Courty, Pascal & Kim, Do Han & Marschke, Gerald, 2009. "Curbing Cream-Skimming: Evidence on Enrolment Incentives," CEPR Discussion Papers 7121, C.E.P.R. Discussion Papers.
- Pascal Courty & Do Han Kim & Gerald Marschke1, 2009. "Curbing cream-skimming: Evidence on enrolment incentives," Economics Working Papers ECO2009/03, European University Institute.
- H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
- J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
- L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
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