IDEAS home Printed from https://ideas.repec.org/a/eee/labeco/v19y2012i3p438-450.html
   My bibliography  Save this article

Job search incentives and job match quality

Author

Listed:
  • Gaure, Simen
  • Røed, Knut
  • Westlie, Lars

Abstract

We examine the impacts of time-limited unemployment insurance (UI) and active labor market programs (ALMP) on the duration and outcome of job search in Norway. We use a comprehensive simultaneous equations model accounting for i) the duration of unemployment spells; ii) their outcomes, iii) subsequent employment stability; and iv) the earnings level associated with the first job. We find that time invested in job search pays off in form of higher earnings once a job match is formed. ALMP raises the probability of eventually finding a job as well as expected earnings, but at the cost of lengthening job search.

Suggested Citation

  • Gaure, Simen & Røed, Knut & Westlie, Lars, 2012. "Job search incentives and job match quality," Labour Economics, Elsevier, vol. 19(3), pages 438-450.
    • Handle: RePEc:eee:labeco:v:19:y:2012:i:3:p:438-450
    DOI: 10.1016/j.labeco.2012.04.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0927537112000292
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.labeco.2012.04.001?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 search for a different version of it.

    References listed on IDEAS

    as
    1. Gerard J. van den Berg & Bas van der Klaauw & Jan C. van Ours, 2004. "Punitive Sanctions and the Transition Rate from Welfare to Work," Journal of Labor Economics, University of Chicago Press, vol. 22(1), pages 211-241, January.
    2. Daron Acemoglu & Robert Shimer, 1999. "Efficient Unemployment Insurance," Journal of Political Economy, University of Chicago Press, vol. 107(5), pages 893-928, October.
    3. Marimon, Ramon & Zilibotti, Fabrizio, 1999. "Unemployment vs. Mismatch of Talents: Reconsidering Unemployment Benefits," Economic Journal, Royal Economic Society, vol. 109(455), pages 266-291, April.
    4. Acemoglu, Daron & Shimer, Robert, 2000. "Productivity gains from unemployment insurance," European Economic Review, Elsevier, vol. 44(7), pages 1195-1224, June.
    5. Bruno Crépon & Marc Ferracci & Grégory Jolivet & Gerard J. van den Berg, 2009. "Active Labor Market Policy Effects in a Dynamic Setting," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 595-605, 04-05.
    6. 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.
    7. Curtis Eberwein & John C. Ham & Robert J. Lalonde, 1997. "The Impact of Being Offered and Receiving Classroom Training on the Employment Histories of Disadvantaged Women: Evidence from Experimental Data," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 64(4), pages 655-682.
    8. David Card & Raj Chetty & Andrea Weber, 2007. "The Spike at Benefit Exhaustion: Leaving the Unemployment System or Starting a New Job?," American Economic Review, American Economic Association, vol. 97(2), pages 113-118, May.
    9. Mário Centeno, 2004. "The Match Quality Gains from Unemployment Insurance," Journal of Human Resources, University of Wisconsin Press, vol. 39(3).
    10. Gaure, Simen & Roed, Knut & Zhang, Tao, 2007. "Time and causality: A Monte Carlo assessment of the timing-of-events approach," Journal of Econometrics, Elsevier, vol. 141(2), pages 1159-1195, December.
    11. McCall, Brian & Chi, Wei, 2008. "Unemployment insurance, unemployment durations and re-employment wages," Economics Letters, Elsevier, vol. 99(1), pages 115-118, April.
    12. Van den Berg, Gerard J., 2001. "Duration models: specification, identification and multiple durations," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 55, pages 3381-3460, Elsevier.
    13. Knut Roed & Tao Zhang, 2003. "Does Unemployment Compensation Affect Unemployment Duration?," Economic Journal, Royal Economic Society, vol. 113(484), pages 190-206, January.
    14. Jespersen, Svend T. & Munch, Jakob R. & Skipper, Lars, 2008. "Costs and benefits of Danish active labour market programmes," Labour Economics, Elsevier, vol. 15(5), pages 859-884, October.
    15. Jaap H. Abbring & Gerard J. van den Berg, 2003. "The Nonparametric Identification of Treatment Effects in Duration Models," Econometrica, Econometric Society, vol. 71(5), pages 1491-1517, September.
    16. Brinch, Christian N., 2007. "Nonparametric Identification Of The Mixed Hazards Model With Time-Varying Covariates," Econometric Theory, Cambridge University Press, vol. 23(2), pages 349-354, April.
    17. Belzil, Christian, 2000. "Unemployment Insurance and Subsequent Job Duration: Job Matching vs Unobserved Heterogeneity," IZA Discussion Papers 116, Institute of Labor Economics (IZA).
    18. Dan A. Black & Jeffrey A. Smith & Mark C. Berger & Brett J. Noel, 2003. "Is the Threat of Reemployment Services More Effective Than the Services Themselves? Evidence from Random Assignment in the UI System," American Economic Review, American Economic Association, vol. 93(4), pages 1313-1327, September.
    19. Raj Chetty, 2008. "Erratum: Moral Hazard versus Liquidity and Optimal Unemployment Insurance," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 1197-1197, December.
    20. Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March.
    21. Meyer, Bruce D, 1990. "Unemployment Insurance and Unemployment Spells," Econometrica, Econometric Society, vol. 58(4), pages 757-782, July.
    22. Christian Belzil, 2001. "Unemployment Insurance and Subsequent Job Duration: Matching vs Unobserved Heterogeneity," Post-Print halshs-00151376, HAL.
    23. Addison, John T. & Blackburn, McKinley L., 2000. "The effects of unemployment insurance on postunemployment earnings," Labour Economics, Elsevier, vol. 7(1), pages 21-53, January.
    24. Konstantinos Tatsiramos, 2009. "Unemployment Insurance in Europe: Unemployment Duration and Subsequent Employment Stability," Journal of the European Economic Association, MIT Press, vol. 7(6), pages 1225-1260, December.
    25. Simen Gaure & Knut Røed, 2008. "How Tight is the Labour Market?: Sources of Changes in the Aggregate Exit Rate from Unemployment across the Business Cycle," Journal of Business Cycle Measurement and Analysis, OECD Publishing, Centre for International Research on Economic Tendency Surveys, vol. 2007(2), pages 155-173.
    26. 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.
    27. van Ours, Jan C. & Vodopivec, Milan, 2008. "Does reducing unemployment insurance generosity reduce job match quality?," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 684-695, April.
    28. 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.
    29. Ehrenberg, Ronald G & Oaxaca, Ronald L, 1976. "Unemployment Insurance, Duration of Unemployment, and Subsequent Wage Gain," American Economic Review, American Economic Association, vol. 66(5), pages 754-766, December.
    30. 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.
    31. Christian Belzil, 2001. "Unemployment insurance and subsequent job duration: job matching versus unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(5), pages 619-636.
    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. Bruce Headey & Ruud Muffels, 2016. "Towards a Theory of Life Satisfaction: Accounting for Stability, Change and Volatility in 25-Year Life Trajectories in Germany," SOEPpapers on Multidisciplinary Panel Data Research 864, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. Lars Pico Geerdsen & Stéphanie Vincent Lyk-Jensen & Cecilie Dohlmann Weatherall, 2018. "Accelerating the transition to employment at benefit exhaustion: still possible after four years of unemployment?," Empirical Economics, Springer, vol. 54(3), pages 1107-1135, May.
    3. Brändle, Tobias & Grunau, Philipp & Haylock, Michael & Kampkötter, Patrick, 2020. "Recruitment strategies and match quality - New evidence from representative linked employer-employee data," University of Tübingen Working Papers in Business and Economics 134, University of Tuebingen, Faculty of Economics and Social Sciences, School of Business and Economics.
    4. Markussen, Simen & Røed, Knut, 2014. "The impacts of vocational rehabilitation," Labour Economics, Elsevier, vol. 31(C), pages 1-13.
    5. Simoes, Nadia, 2013. "Subsídio de desemprego: uma revisão da literatura teórica e empírica [Unemployment insurance: a survey]," MPRA Paper 52332, University Library of Munich, Germany.
    6. Røed, Knut, 2012. "Active Unemployment Insurance," IZA Policy Papers 41, Institute of Labor Economics (IZA).
    7. Verónica Escudero, 2018. "Are active labour market policies effective in activating and integrating low-skilled individuals? An international comparison," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-26, December.
    8. Anna Godøy & Knut Røed, 2016. "Unemployment Insurance and Underemployment," LABOUR, CEIS, vol. 30(2), pages 158-179, June.
    9. Gerards, Ruud & Welters, Ricardo, 2016. "Impact of financial pressure on unemployed job search, job find success and job quality," ROA Research Memorandum 008, Maastricht University, Research Centre for Education and the Labour Market (ROA).
    10. Knut Røed & Jens Fredrik Skogstrøm, 2014. "Unemployment Insurance and Entrepreneurship," LABOUR, CEIS, vol. 28(4), pages 430-448, December.
    11. Cristian Darío Castillo Robayo & Javier García Estévez, 2019. "Desempleo juvenil en Colombia: ¿la educación importa?," Revista Finanzas y Politica Economica, Universidad Católica de Colombia, vol. 11(1), pages 101-101, February.
    12. Holmås, Tor Helge & Monstad, Karin & Reme, Silje Endresen, 2021. "Regular employment for people with mental illness – An evaluation of the individual placement and support programme," Social Science & Medicine, Elsevier, vol. 270(C).
    13. Yi Zhang & Martin Salm & Arthur Soest, 2021. "The effect of training on workers’ perceived job match quality," Empirical Economics, Springer, vol. 60(5), pages 2477-2498, May.
    14. Sørensen, Kenneth Lykke, 2016. "Heterogeneous impacts on earnings from an early effort in labor market programs," Labour Economics, Elsevier, vol. 41(C), pages 266-279.
    15. repec:ilo:ilowps:487304 is not listed on IDEAS
    16. Kenneth L. Sørensen, 2012. "Effects of Intensifying Labor Market Programs on Post-Unemployment Wages: Evidence From a Controlled Experiment," Economics Working Papers 2012-20, Department of Economics and Business Economics, Aarhus University.
    17. Marta Silva & Luis Filipe Martins & Helena Lopes, 2015. "Asymmetric labour market reforms and wage growth with fixed-term contracts: does learning about match quality matter?," Working Papers Series 2 15-04, ISCTE-IUL, Business Research Unit (BRU-IUL).
    18. Kampkötter, Patrick & Petters, Lea M. & Sliwka, Dirk, 2021. "Employee identification and wages – on the economics of “Affective Commitment”," Journal of Economic Behavior & Organization, Elsevier, vol. 188(C), pages 608-626.
    19. Kyyrä, Tomi & Pesola, Hanna & Verho, Jouko, 2017. "The spike at benefit exhaustion in the Finnish labor market," Working Papers 86, VATT Institute for Economic Research.
    20. Johansson, Per & Lee, Myoung-jae, 2016. "On Nonparametric Identification of Treatment Effects in Duration Models," IZA Discussion Papers 10247, Institute of Labor Economics (IZA).
    21. Gerards, Ruud & Welters, Riccardo, 2022. "Job search in the presence of a stressor: Does financial hardship change the effectiveness of job search?," Journal of Economic Psychology, Elsevier, vol. 90(C).
    22. Tiemen M. Woutersen & John Ham, 2013. "Calculating confidence intervals for continuous and discontinuous functions of parameters," CeMMAP working papers CWP23/13, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    23. Ham, John C. & Woutersen, Tiemen, 2011. "Calculating Confidence Intervals for Continuous and Discontinuous Functions of Estimated Parameters," IZA Discussion Papers 5816, Institute of Labor Economics (IZA).
    24. Kyyrä, Tomi & Pesola, Hanna & Verho, Jouko, 2019. "The spike at benefit exhaustion: The role of measurement error in benefit eligibility," Labour Economics, Elsevier, vol. 60(C), pages 75-83.
    25. 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.

    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. 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.
    2. 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.
    3. Tito Boeri & Jan van Ours, 2013. "The Economics of Imperfect Labor Markets: Second Edition," Economics Books, Princeton University Press, edition 1, number 10142.
    4. Petrongolo, Barbara, 2009. "The long-term effects of job search requirements: Evidence from the UK JSA reform," Journal of Public Economics, Elsevier, vol. 93(11-12), pages 1234-1253, December.
    5. Yolanda Rebollo-Sanz & J. García-Pérez, 2015. "Are unemployment benefits harmful to the stability of working careers? The case of Spain," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 6(1), pages 1-41, March.
    6. Milan Vodopivec, 2013. "Introducing unemployment insurance to developing countries," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-23, December.
    7. Caliendo, Marco & Künn, Steffen & Uhlendorff, Arne, 2016. "Earnings exemptions for unemployed workers: The relationship between marginal employment, unemployment duration and job quality," Labour Economics, Elsevier, vol. 42(C), pages 177-193.
    8. Røed, Knut & Westlie, Lars, 2007. "Unemployment Insurance in Welfare States: Soft Constraints and Mild Sanctions," Memorandum 13/2007, Oslo University, Department of Economics.
    9. Le Barbanchon, Thomas, 2016. "The effect of the potential duration of unemployment benefits on unemployment exits to work and match quality in France," Labour Economics, Elsevier, vol. 42(C), pages 16-29.
    10. Barbara Petrongolo, 2007. "What Are the Long-Term Effects of UI? Evidence from the UK JSA Reform," CEP Discussion Papers dp0841, Centre for Economic Performance, LSE.
    11. Bart Cockx & Matteo Picchio, 2013. "Scarring effects of remaining unemployed for long-term unemployed school-leavers," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 176(4), pages 951-980, October.
    12. Konstantinos Tatsiramos, 2009. "Unemployment Insurance in Europe: Unemployment Duration and Subsequent Employment Stability," Journal of the European Economic Association, MIT Press, vol. 7(6), pages 1225-1260, December.
    13. Arash Nekoei & Andrea Weber, 2017. "Does Extending Unemployment Benefits Improve Job Quality?," American Economic Review, American Economic Association, vol. 107(2), pages 527-561, February.
    14. Lachowska, Marta & Meral, Merve & Woodbury, Stephen A., 2016. "Effects of the unemployment insurance work test on long-term employment outcomes," Labour Economics, Elsevier, vol. 41(C), pages 246-265.
    15. Jan C. van Ours, 2007. "Compulsion in active labour market programmes," National Institute Economic Review, National Institute of Economic and Social Research, vol. 202(1), pages 67-78, October.
    16. Simoes, Nadia, 2013. "Subsídio de desemprego: uma revisão da literatura teórica e empírica [Unemployment insurance: a survey]," MPRA Paper 52332, University Library of Munich, Germany.
    17. 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).
    18. Bart Cockx & Matteo Picchio, 2012. "Are Short-lived Jobs Stepping Stones to Long-Lasting Jobs?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 74(5), pages 646-675, October.
    19. Tatsiramos, Konstantinos, 2004. "The Effect of Unemployment Insurance on Unemployment Duration and the Subsequent Employment Stability," IZA Discussion Papers 1163, Institute of Labor Economics (IZA).
    20. Konstantinos Tatsiramos, 2014. "Unemployment benefits and job match quality," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-44, July.

    More about this item

    Keywords

    Multivariate hazards; Job search; Job quality; Timing-of-events; NPMLE; MMPH;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - 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:eee:labeco:v:19:y:2012:i:3:p:438-450. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/labeco .

    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.