Advanced Search
MyIDEAS: Login

Is the Contracting-Out of Intensive Placement Services More Effective than Provision by the PES? Evidence from a Randomized Field Experiment

Contents:

Author Info

  • Krug, Gerhard

    ()
    (Institute for Employment Research (IAB), Nuremberg)

  • Stephan, Gesine

    ()
    (Institute for Employment Research (IAB), Nuremberg)

Registered author(s):

    Abstract

    There is a longstanding debate on the advantages of quasi-markets for placement services compared to their public deliverance. During 2009, the German Public Employment Service (PES) implemented a randomized field experiment to investigate if intensive services for hard-to-place unemployed individuals can be provided more effectively by such private providers or by PES in-house teams. Unemployed persons were assigned to intensive services for a period of eight months. This paper presents the first results of this experiment; the observation period covers 18 months after assignment. Initial in-house provision reduces accumulated days in unemployment by one to two months. Approximately two thirds of this effect is attributable to labor market withdrawals. The effect on the share of individuals in a given labor market status (unemployed, employed, and withdrawn) occurs mainly during the program period of eight months and disappears by the end of the observation period. We conclude that in a particular environment, the public provision of placement services can be as least as effective as contracting-out - a simple comparison of effectiveness might, however, be misleading.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://ftp.iza.org/dp7403.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7403.

    as in new window
    Length: 36 pages
    Date of creation: May 2013
    Date of revision:
    Handle: RePEc:iza:izadps:dp7403

    Contact details of provider:
    Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
    Phone: +49 228 3894 223
    Fax: +49 228 3894 180
    Web page: http://www.iza.org

    Order Information:
    Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
    Email:

    Related research

    Keywords: intensive placement services; contracting-out; randomized field experiment;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Anthony E. Boardman & Erica Susan Hewitt, 2004. "Problems with contracting out government services: lessons from orderly services at SCGH," Industrial and Corporate Change, Oxford University Press, vol. 13(6), pages 917-929, December.
    2. German Blanco & Carlos A. Flores & Alfonso Flores-Lagunes, 2013. "Bounds on Average and Quantile Treatment Effects of Job Corps Training on Wages," Journal of Human Resources, University of Wisconsin Press, vol. 48(3), pages 659-701.
    3. Marco Caliendo & Reinhard Hujer, 2006. "The microeconometric estimation of treatment effects—An overview," AStA Advances in Statistical Analysis, Springer, vol. 90(1), pages 199-215, March.
    4. Behaghel, Luc & Crépon, Bruno & Gurgand, Marc, 2012. "Private and Public Provision of Counseling to Job-Seekers: Evidence from a Large Controlled Experiment," IZA Discussion Papers 6518, Institute for the Study of Labor (IZA).
    5. Arni, Patrick & Lalive, Rafael & van Ours, Jan C., 2009. "How effective are unemployment benefit sanctions? Looking beyond unemployment exit," Working Paper Series 2009:22, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    6. Pascal Courty & Gerald Marschke, 2004. "An Empirical Investigation of Gaming Responses to Explicit Performance Incentives," Journal of Labor Economics, University of Chicago Press, vol. 22(1), pages 23-56, January.
    7. Dehejia, R.H. & Wahba, S., 1998. "Propensity Score Matching Methods for Non-Experimental Causal Studies," Discussion Papers 1998_02, Columbia University, Department of Economics.
    8. Bernhard, Sarah & Wolff, Joachim, 2008. "Contracting out placement services in Germany : is assignment to private providers effective for needy job-seekers?," IAB Discussion Paper 200805, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    9. Andrei Shleifer, 1998. "State Versus Private Ownership," Harvard Institute of Economic Research Working Papers 1841, Harvard - Institute of Economic Research.
    10. Domberger, Simon & Jensen, Paul, 1997. "Contracting Out by the Public Sector: Theory, Evidence, Prospects," Oxford Review of Economic Policy, Oxford University Press, vol. 13(4), pages 67-78, Winter.
    11. Caliendo, Marco & Kopeinig, Sabine, 2005. "Some Practical Guidance for the Implementation of Propensity Score Matching," IZA Discussion Papers 1588, Institute for the Study of Labor (IZA).
    12. Pierre Koning & C.J. Heinrich, 2009. "Cream-skimming, parking and other intended and unintended effects of performance-based contracting in social welfare services," CPB Discussion Paper 134, CPB Netherlands Bureau for Economic Policy Analysis.
    13. Paul A. Grout & Margaret Stevens, 2003. "The Assessment: Financing and Managing Public Services," Oxford Review of Economic Policy, Oxford University Press, vol. 19(2), pages 215-234, Summer.
    14. Winterhager, Henrik, 2006. "Private Job Placement Services: A Microeconometric Evaluation for Germany," ZEW Discussion Papers 06-26, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    15. David S. Lee, 2009. "Training, Wages, and Sample Selection: Estimating Sharp Bounds on Treatment Effects," Review of Economic Studies, Oxford University Press, vol. 76(3), pages 1071-1102.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp7403. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.