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A General Equilibrium Evaluation of the Employment Service

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  • Miana Plesca

Abstract

This paper provides a general equilibrium evaluation of the Employment Service, also known as the Public Labor Exchange (PLX), a national program that facilitates meetings between job seekers and vacancies. The paper departs from the standard partial equilibrium framework of program evaluation by constructing a dynamic general equilibrium matching model with the PLX as a directed search channel and all other search methods as the other channel. In the calibrated model, the general equilibrium impacts of the PLX are different from the standard partial equilibrium ones, mainly because employers post more high-skill vacancies when both search channels operate.

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  • Miana Plesca, 2010. "A General Equilibrium Evaluation of the Employment Service," Journal of Human Capital, University of Chicago Press, vol. 4(3), pages 274-329.
    • Handle: RePEc:ucp:jhucap:doi:10.1086/658491
    DOI: 10.1086/658491
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    1. Fougère, Denis & Pradel, Jacqueline & Roger, Muriel, 2009. "Does the public employment service affect search effort and outcomes?," European Economic Review, Elsevier, vol. 53(7), pages 846-869, October.
    2. Jeffrey Smith & Jeremy Lise & Shannon N. Seitz, 2003. "Equilibrium Policy Experiments And The Evaluation Of Social Programs," Working Paper 1012, Economics Department, Queen's University.
    3. repec:wop:calsdi:97-23 is not listed on IDEAS
    4. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
    5. Francisco M. Gonzalez & Shouyong Shi, 2010. "An Equilibrium Theory of Learning, Search, and Wages," Econometrica, Econometric Society, vol. 78(2), pages 509-537, March.
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    9. John T. Addison & Pedro Portugal, 2002. "Job search methods and outcomes," Oxford Economic Papers, Oxford University Press, vol. 54(3), pages 505-533, July.
    10. James Heckman & Lance Lochner & Christopher Taber, 1998. "Explaining Rising Wage Inequality: Explanations With A Dynamic General Equilibrium Model of Labor Earnings With Heterogeneous Agents," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 1(1), pages 1-58, January.
    11. Lindeboom, Maarten & van Ours, Jan C & Renes, Gusta, 1994. "Matching Employers and Workers: An Empirical Analysis on the Effectiveness of Search," Oxford Economic Papers, Oxford University Press, vol. 46(1), pages 45-67, January.
    12. Isaac Ehrlich & Kevin M. Murphy, 2007. "Why Does Human Capital Need a Journal?," Journal of Human Capital, University of Chicago Press, vol. 1(1), pages 1-7.
    13. Osberg, Lars, 1993. "Fishing in Different Pools: Job Search Strategies and Job-Finding Success in Canada in the Early 1980s," Journal of Labor Economics, University of Chicago Press, vol. 11(2), pages 348-386, April.
    14. Albrecht, James & van den Berg, Gerard J & Vroman, Susan, 2004. "The knowledge lift: The Swedish adult education program that aimed to eliminate low worker skill levels," Working Paper Series 2004:17, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    15. Kenneth I. Wolpin & Petra E. Todd, 2006. "Assessing the Impact of a School Subsidy Program in Mexico: Using a Social Experiment to Validate a Dynamic Behavioral Model of Child Schooling and Fertility," American Economic Review, American Economic Association, vol. 96(5), pages 1384-1417, December.
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    1. Fougère, Denis & Pradel, Jacqueline & Roger, Muriel, 2009. "Does the public employment service affect search effort and outcomes?," European Economic Review, Elsevier, vol. 53(7), pages 846-869, October.
    2. James Albrecht & Gerard van den Berg & Susan Vroman, 2009. "The Aggregate Labor Market Effects of the Swedish Knowledge Lift Program," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 12(1), pages 129-146, January.
    3. Jeremy Lise & Shannon Seitz & Jeffrey Smith, 2015. "Evaluating search and matching models using experimental data," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-35, December.
    4. Mathieu Bunel & Elisabeth Tovar, 2015. "Spatial Mismatch through Local Public Employment Agencies? Answers from a French Quasi-Experiment," EconomiX Working Papers 2015-32, University of Paris Nanterre, EconomiX.
    5. Launov, Andrey & Wälde, Klaus, 2016. "The employment effect of reforming a public employment agency," European Economic Review, Elsevier, vol. 84(C), pages 140-164.
    6. Chassamboulli Andri, 2011. "Cyclical Upgrading of Labor and Employment Differences across Skill Groups," The B.E. Journal of Macroeconomics, De Gruyter, vol. 11(1), pages 1-42, May.
    7. Launov, Andrey & Wälde, Klaus, 2014. "Thumbscrews for Agencies or Individuals? How to reduce unemployment," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100558, Verein für Socialpolitik / German Economic Association.

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    More about this item

    JEL classification:

    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity

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