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To work or not to work? Effects of temporary public employment on future employment and benefits

Author

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  • Mörk, Eva

    (Department of Economics, Uppsala University)

  • Ottosson, Lillit

    (IFAU - Institute for Evaluation of Labour Market and Education Policy)

  • Vikman, Ulrika

    (IFAU - Institute for Evaluation of Labour Market and Education Policy)

Abstract

We evaluate a temporary public sector employment program targeted at individuals with weak labor market attachment in the City of Stockholm. Having access to rich high-quality individuallevel administrative data, we apply dynamic inverse probability weighting, proposed by Van den Berg and Vikström (2021), to deal with dynamic selection into the program. We find that the program is successful in increasing employment and reducing social assistance. However, being at a regular workplace seems crucial: we find negative employment effects for participants engaged in outdoor cleaning at a workplace created especially for the program. In addition, we find that the decrease in social assistance recipiency to some extent is countered by an increase in the share receiving unemployment insurance benefits. This tendency is especially pronounced for the program with negative employment effects.

Suggested Citation

  • 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.
    • Handle: RePEc:hhs:ifauwp:2021_012
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    Cited by:

    1. Jeremias Nieminen & Ohto Kanninen & Hannu Karhunen, 2023. "The decentralization of public employment services and local governments’ responses to incentives," Journal of Economic Geography, Oxford University Press, vol. 23(6), pages 1371-1395.
    2. Aronsson, Thomas & Bastani, Spencer & Tayibov, Khayyam, 2021. "Social Exclusion and Optimal Redistribution," Umeå Economic Studies 1004, Umeå University, Department of Economics.
    3. Bastiaans, Mareen & Dur, Robert & Gielen, Anne C., 2024. "Activating the long-term inactive: Labor market and mental health effects," Labour Economics, Elsevier, vol. 90(C).
    4. Ohto Kanninen & Hannu Karhunen & Jeremias Nieminen, "undated". "Effect of Secondary Education on Cognitive and Non-cognitive Skills," Working Papers 337, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.

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    More about this item

    Keywords

    Public sector employment programs; Social assistance; Cost-shifting; Dynamic inverse probability weighting;
    All these keywords.

    JEL classification:

    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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