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Do Reemployment Bonuses Increase Employment? Evidence from the Idaho Return to Work Bonus Program

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  • Hobbs, Duncan

    (American Enterprise Institute for Public Policy Research)

  • Strain, Michael R.

    (American Enterprise Institute for Public Policy Research)

Abstract

In June 2020, Idaho announced the Return to Work Bonus program, which provided residents who returned to work with bonuses of up to $1,500. Using multiple data sources, we present difference-in-differences, triple differences, and synthetic control estimates suggesting the program may have increased individual employment and accelerated flows into employment from unemployment and from nonparticipation in the labor force. We show the program likely increased state-level employment rates. To the best of our knowledge, this is the first paper to study the effects of reemployment bonuses on the U.S. labor market outside an experimental setting.

Suggested Citation

  • Hobbs, Duncan & Strain, Michael R., 2024. "Do Reemployment Bonuses Increase Employment? Evidence from the Idaho Return to Work Bonus Program," IZA Discussion Papers 16924, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp16924
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    References listed on IDEAS

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    More about this item

    Keywords

    reemployment bonus; unemployment insurance; employment;
    All these keywords.

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • 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

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