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Conditional Cash Transfers on the Labor Market: Evidence from Young French Jobseekers

Author

Listed:
  • Chiodi, Vera

    (Université Sorbonne Nouvelle / IHEAL)

  • Crépon, Bruno

    (CREST)

  • John, Anett

    (University of Birmingham and CREST)

Abstract

Youth participation in employability programs is usually low. This paper studies the first pure test of a randomized conditional cash transfer linked to participation in labor activation measures: young, unskilled jobseekers in France receive a monthly cash transfer for a two-year period totaling up to €4800, conditional on their participation in the French national career guidance program. Cash transfers lead to a significant increase in program participation (which mainly entails meetings with counselors), and sharply reduced drop-out rates. As a result, there is a large increase in the job offers, vocational training and career building workshops proposed to the jobseekers. However, jobseekers' response to these increased opportunities for employability investment is precisely estimated to be zero. Moreover, we observe a significant reduction in employment over the first six months. The results point to a strong impact of financial incentives, but also to the need to condition incentives directly on outcomes of interest, rather than on intermediate targets.

Suggested Citation

  • Chiodi, Vera & Crépon, Bruno & John, Anett, 2026. "Conditional Cash Transfers on the Labor Market: Evidence from Young French Jobseekers," IZA Discussion Papers 18717, IZA Network @ LISER.
    • Handle: RePEc:iza:izadps:dp18717
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    Keywords

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    JEL classification:

    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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