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Estimating Equilibrium Effects of Job Search Assistance

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  • Pieter Gautier

    (VU University Amsterdam)

Abstract

Identifying policy-relevant treatment effects from randomized experiments requires no spillovers between participants and nonparticipants (SUTVA) or variation in treatment levels. We find that SUTVA is violated for a Danish activation program for unemployed workers. Using a difference-in-difference model we show that the nonparticipants in the experiment regions find jobs slower after the introduction of the activation program (relative to workers in other regions). We then estimate an equilibrium search model. This model shows that a large-scale roll out of the activation program decreases welfare, while a standard partial microeconometric cost-benefit analysis concludes the opposite.

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  • Pieter Gautier, 2017. "Estimating Equilibrium Effects of Job Search Assistance," 2017 Meeting Papers 188, Society for Economic Dynamics.
    • Handle: RePEc:red:sed017:188
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    More about this item

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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