IDEAS home Printed from https://ideas.repec.org/a/bpj/bejeap/v25y2025i4p959-997n1003.html
   My bibliography  Save this article

Hiring Subsidies for Low-Educated Unemployed Youths are Ineffective in a Tight Labor Market

Author

Listed:
  • Dejemeppe Muriel

    (IRES/LIDAM, UCLouvain, Louvain-la-Neuve, Belgium)

  • Delpierre Matthieu

    (IWEPS, Namur, Belgium)

  • Pourtois Mathilde

    (IRES/LIDAM, UCLouvain, Louvain-la-Neuve, Belgium)

Abstract

We evaluate the impact of hiring subsidies for unemployed jobseekers in Wallonia, the French-speaking region in Belgium, focusing on low-educated youths who gain earlier access to subsidies. Using a regression discontinuity design, we find that prioritizing subsidies for them leads to deadweight losses during the pre-pandemic economic boom. Positive job-finding effects are observed for high school graduates in areas with lower labor market tightness, supporting the hypothesis that this factor drives inefficiency. For high school dropouts, no effects are detected. This may reflect loose targeting – such as lack of a minimum unemployment duration – but other group differences could also play a role.

Suggested Citation

  • Dejemeppe Muriel & Delpierre Matthieu & Pourtois Mathilde, 2025. "Hiring Subsidies for Low-Educated Unemployed Youths are Ineffective in a Tight Labor Market," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 25(4), pages 959-997.
    • Handle: RePEc:bpj:bejeap:v:25:y:2025:i:4:p:959-997:n:1003
    DOI: 10.1515/bejeap-2024-0241
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/bejeap-2024-0241
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/bejeap-2024-0241?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

    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:bpj:bejeap:v:25:y:2025:i:4:p:959-997:n:1003. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Peter Golla (email available below). General contact details of provider: https://www.degruyterbrill.com .

    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.