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Compulsion in active labour market programmes

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  • van Ours, Jan C.

Abstract

This paper examines compulsion in active labour market programmes (ALMP). When an unemployed worker has to participate in a programme in order to remain eligible for benefits there are two seperate effects. First, there is the treatment effect, i.e. the programme makes the worker more attractive for a potential employer or makes search more efficient, thus helping the unemployed worker to find a job more quickly. Second, there is the compulsion effect, i.e. because the worker has to attend the programme his value of being unemployed drops and he is stimulated to find a job more quickly. So, both effects induce the worker to find a job more quickly. The difference between the treatment effect and the compulsion effect concerns the quality of the post-unemployment job. The treatment effect improves the quality; the compulsion effect lowers the quality of post-unemployment jobs.

Suggested Citation

  • van Ours, Jan C., 2007. "Compulsion in active labour market programmes," National Institute Economic Review, National Institute of Economic and Social Research, vol. 202, pages 67-78, October.
    • Handle: RePEc:cup:nierev:v:202:y:2007:i::p:67-78_8
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    Cited by:

    1. Zuzana Brixiova & Balázs Egert, 2012. "Labour Market Reforms and Outcomes in Estonia," Working Papers hal-04141083, HAL.

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