IDEAS home Printed from https://ideas.repec.org/a/aea/aejpol/v8y2016i1p180-211.html
   My bibliography  Save this article

Leaving Poverty Behind? The Effects of Generous Income Support Paired with Activation

Author

Listed:
  • Simen Markussen
  • Knut Røed

Abstract

We evaluate a comprehensive activation program in Norway targeted at hard-to-employ social assistance claimants with reduced work capacity. The program offers a combination of tailored rehabilitation, training, and job practice, and a generous, stable, and non-means-tested benefit. Its primary aims are to mitigate poverty and subsequently promote self-supporting employment. Our evaluation strategy exploits a geographically staggered program introduction, and the causal effects are identified on the basis of changes in employment prospects that coincide with local program implementation in a way that correlates with the predicted probability of becoming a participant. We find that the program raised employment prospects considerably. (JEL H55, I32, I38, J24)

Suggested Citation

  • Simen Markussen & Knut Røed, 2016. "Leaving Poverty Behind? The Effects of Generous Income Support Paired with Activation," American Economic Journal: Economic Policy, American Economic Association, vol. 8(1), pages 180-211, February.
    • Handle: RePEc:aea:aejpol:v:8:y:2016:i:1:p:180-211
    Note: DOI: 10.1257/pol.20140334
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/pol.20140334
    Download Restriction: no
    File URL: http://www.aeaweb.org/aej/pol/data/0801/2014-0334_data.zip
    Download Restriction: no
    File URL: http://www.aeaweb.org/aej/pol/ds/0801/2014-0334_ds.zip
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Markussen, Simen & Røed, Knut, 2014. "The impacts of vocational rehabilitation," Labour Economics, Elsevier, vol. 31(C), pages 1-13.
    2. Krueger, Alan B. & Meyer, Bruce D., 2002. "Labor supply effects of social insurance," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 33, pages 2327-2392, Elsevier.
    3. David Card & Jochen Kluve & Andrea Weber, 2010. "Active Labour Market Policy Evaluations: A Meta-Analysis," Economic Journal, Royal Economic Society, vol. 120(548), pages 452-477, November.
    4. Markus Frölich & Almas Heshmati & Michael Lechner, 2004. "A microeconometric evaluation of rehabilitation of long-term sickness in Sweden," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(3), pages 375-396.
    5. Aakvik, Arild & Heckman, James J. & Vytlacil, Edward J., 2005. "Estimating treatment effects for discrete outcomes when responses to treatment vary: an application to Norwegian vocational rehabilitation programs," Journal of Econometrics, Elsevier, vol. 125(1-2), pages 15-51.
    6. Dasgupta, Partha, 1997. "Nutritional status, the capacity for work, and poverty traps," Journal of Econometrics, Elsevier, vol. 77(1), pages 5-37, March.
    7. Jochen Kluve & David Card & Michael Fertig & Marek Góra & Lena Jacobi & Peter Jensen & Reelika Leetmaa & Leonhard Nima & Eleonora Patacchini & Sandra Schaffner & Christoph M. Schmidt & Bas Klaauw & An, 2007. "Active Labor Market Policies in Europe," Springer Books, Springer, number 978-3-540-48558-2, September.
    8. Knut Røed & Oddbjørn Raaum, 2006. "Do Labour Market Programmes Speed up the Return to Work?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 68(5), pages 541-568, October.
    9. Knut Røed, 2012. "Active social insurance," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 1(1), pages 1-22, December.
    10. Dasgupta, Partha & Ray, Debraj, 1986. "Inequality as a Determinant of Malnutrition and Unemployment: Theory," Economic Journal, Royal Economic Society, vol. 96(384), pages 1011-1034, December.
    11. Altindag, Duha T., 2012. "Crime and unemployment: Evidence from Europe," International Review of Law and Economics, Elsevier, vol. 32(1), pages 145-157.
    12. Fevang, Elisabeth & Hardoy, Inés & Røed, Knut, 2013. "Getting Disabled Workers Back to Work: How Important Are Economic Incentives?," IZA Discussion Papers 7137, Institute of Labor Economics (IZA).
    13. Ashenfelter, Orley C, 1978. "Estimating the Effect of Training Programs on Earnings," The Review of Economics and Statistics, MIT Press, vol. 60(1), pages 47-57, February.
    14. Dasgupta, Partha & Ray, Debraj, 1987. "Inequality as a Determinant of Malnutrition and Unemployment: Policy," Economic Journal, Royal Economic Society, vol. 97(385), pages 177-188, March.
    15. Mari Rege & Kjetil Telle & Mark Votruba, 2012. "Social Interaction Effects in Disability Pension Participation: Evidence from Plant Downsizing," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(4), pages 1208-1239, December.
    16. Ming-Jen Lin, 2008. "Does Unemployment Increase Crime?: Evidence from U.S. Data 1974–2000," Journal of Human Resources, University of Wisconsin Press, vol. 43(2), pages 413-436.
    17. Antoni Calvó-Armengol & Matthew O. Jackson, 2004. "The Effects of Social Networks on Employment and Inequality," American Economic Review, American Economic Association, vol. 94(3), pages 426-454, June.
    18. Roed, Knut & Zhang, Tao, 2005. "Unemployment duration and economic incentives--a quasi random-assignment approach," European Economic Review, Elsevier, vol. 49(7), pages 1799-1825, October.
    19. Knut Roed & Tao Zhang, 2003. "Does Unemployment Compensation Affect Unemployment Duration?," Economic Journal, Royal Economic Society, vol. 113(484), pages 190-206, January.
    20. Tom Christensen & Anne Fimreite & Per Lægreid, 2014. "Joined-Up Government for Welfare Administration Reform in Norway," Public Organization Review, Springer, vol. 14(4), pages 439-456, December.
    21. Knut Røed & Lars Westlie, 2012. "Unemployment Insurance In Welfare States: The Impacts Of Soft Duration Constraints," Journal of the European Economic Association, European Economic Association, vol. 10(3), pages 518-554, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. van der Klaauw, Bas & Ziegler, Lennart, 2019. "A Field Experiment on Labor Market Speeddates for Unemployed Workers," IZA Discussion Papers 12140, Institute of Labor Economics (IZA).
    2. Mörk, Eva & Ottosson, Lillit & Vikman, Ulrika, 2021. "To work or not to work? Effects of temporary public employment on future employment and benefits," Working Paper Series 2021:12, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    3. Antonia Asenjo & Verónica Escudero & Hannah Liepmann, 2024. "Why Should we Integrate Income and Employment Support? A Conceptual and Empirical Investigation," Journal of Development Studies, Taylor & Francis Journals, vol. 60(1), pages 1-29, January.
    4. Hernæs, Øystein & Markussen, Simen & Røed, Knut, 2017. "Can welfare conditionality combat high school dropout?," Labour Economics, Elsevier, vol. 48(C), pages 144-156.
    5. Pignatti Clemente & Van Belle Eva, 2021. "Better together: Active and passive labor market policies in developed and developing economies," IZA Journal of Development and Migration, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 12(1), pages 1-27, January.
    6. Monique De Haan & Ragnhild C. Schreiner, 2018. "The Intergenerational Transmission of Welfare Dependency," CESifo Working Paper Series 7140, CESifo.
    7. Cheng Lin & Adel Daoud & Maria Branden, 2022. "To What Extent Do Disadvantaged Neighborhoods Mediate Social Assistance Dependency? Evidence from Sweden," Papers 2206.04773, arXiv.org, revised Aug 2022.
    8. Cobb-Clark, Deborah A. & Dahmann, Sarah C. & Gielen, Anne C., 2020. "The Intergenerational Effects of Requiring Unemployment Benefit Recipients to Engage in Non-Search Activities," IZA Discussion Papers 13618, Institute of Labor Economics (IZA).
    9. Joyce, Patrick, 2018. "Inspiration for integration. Labour market policies for refugees in five Northern European countries," Ratio Working Papers 308, The Ratio Institute.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Markussen, Simen & Røed, Knut, 2014. "The impacts of vocational rehabilitation," Labour Economics, Elsevier, vol. 31(C), pages 1-13.
    2. Knut Røed, 2012. "Active social insurance," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 1(1), pages 1-22, December.
    3. Fevang, Elisabeth & Hardoy, Inés & Røed, Knut, 2013. "Getting Disabled Workers Back to Work: How Important Are Economic Incentives?," IZA Discussion Papers 7137, Institute of Labor Economics (IZA).
    4. Rehwald, Kai & Rosholm, Michael & Rouland, Bénédicte, 2018. "Labour market effects of activating sick-listed workers," Labour Economics, Elsevier, vol. 53(C), pages 15-32.
    5. Bratsberg, Bernt & Raaum, Oddbjørn & Røed, Knut, 2020. "Immigrant Responses to Social Insurance Generosity," Labour Economics, Elsevier, vol. 65(C).
    6. Hagen, Tobias, 2016. "Econometric Evaluation of a Placement Coaching Program for Recipients of Disability Insurance Benefits in Switzerland," VfS Annual Conference 2016 (Augsburg): Demographic Change 145736, Verein für Socialpolitik / German Economic Association.
    7. Hagen, Tobias, 2016. "Econometric evaluation of a placement coaching program for recipients of disability insurance benefits in Switzerland," Working Paper Series 10, Frankfurt University of Applied Sciences, Faculty of Business and Law.
    8. Gaure, Simen & Røed, Knut & Westlie, Lars, 2012. "Job search incentives and job match quality," Labour Economics, Elsevier, vol. 19(3), pages 438-450.
    9. Hernæs, Øystein & Markussen, Simen & Røed, Knut, 2017. "Can welfare conditionality combat high school dropout?," Labour Economics, Elsevier, vol. 48(C), pages 144-156.
    10. Kai Rehwald & Michael Rosholm & Bénédicte Rouland, 2015. "Does Activating Sick-Listed Workers Work? Evidence from a Randomized Experiment," Working Papers hal-01228454, HAL.
    11. Røed, Knut, 2012. "Active Unemployment Insurance," IZA Policy Papers 41, Institute of Labor Economics (IZA).
    12. Konstantinos Tatsiramos & Jan C. Ours, 2014. "Labor Market Effects Of Unemployment Insurance Design," Journal of Economic Surveys, Wiley Blackwell, vol. 28(2), pages 284-311, April.
    13. Michelle Yin & Garima Siwach & Dajun Lin, 2023. "Vocational Rehabilitation Services and Labor Market Outcomes for Transition‐Age Youth with Disabilities in Maine," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 42(1), pages 166-197, January.
    14. Jing You & Katsushi S. Imai & Raghav Gaiha, 2014. "Decoding the Growth-Nutrition Nexus in China: Inequality, Uncertainty and Food Insecurity," Discussion Paper Series DP2014-28, Research Institute for Economics & Business Administration, Kobe University, revised Dec 2014.
    15. Mareen Bastiaans & Robert Dur & Anne C. Gielen, 2023. "Activating the Long-Term Inactive: Labor Market and Mental Health Effects," Tinbergen Institute Discussion Papers 23-003/V, Tinbergen Institute.
    16. Ruhose, Jens & Thomsen, Stephan L. & Weilage, Insa, 2018. "The Wider Benefits of Adult Learning: Work-Related Training and Social Capital," IZA Discussion Papers 11854, Institute of Labor Economics (IZA).
    17. Imai, Katsushi S. & Gaiha, Raghav & Thapa, Ganesh, 2015. "Does non-farm sector employment reduce rural poverty and vulnerability? Evidence from Vietnam and India," Journal of Asian Economics, Elsevier, vol. 36(C), pages 47-61.
    18. Gaure, Simen & Røed, Knut & Westlie, Lars, 2008. "The Impacts of Labor Market Policies on Job Search Behavior and Post-Unemployment Job Quality," Memorandum 22/2008, Oslo University, Department of Economics.
    19. Bruce D. Meyer & Wallace K. C. Mok, 2007. "Quasi-Experimental Evidence on the Effects of Unemployment Insurance from New York State," NBER Working Papers 12865, National Bureau of Economic Research, Inc.
    20. Lentz, Erin C. & Barrett, Christopher B., 2013. "The economics and nutritional impacts of food assistance policies and programs," Food Policy, Elsevier, vol. 42(C), pages 151-163.

    More about this item

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejpol:v:8:y:2016:i:1:p:180-211. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.