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Are Two Carrots Better Than One? The Effects of Adding Employment Services to Financial Incentive Programs for Welfare Recipients

Author

Listed:
  • Phillip K. Robins

    () (Department of Economics, University of Miami)

  • Charles Michalopoulos

    () (MDRC)

  • Kelly Foley

    () (University of British Columbia)

Abstract

The Self-Sufficiency Project (SSP) was a social experiment conducted in two provinces in Canada during the 1990s that tested a generous financial incentive program for welfare recipients. A little-known subsidiary experiment, called SSP Plus, had a three-way design that tested the incremental effect of adding employment services to the generous financial incentive program. Employment services are viewed by many welfare analysts as an important component of an overall strategy for helping welfare recipients escape poverty and achieve stable employment. This paper presents the results of the SSP Plus experiment. Adding employment services encouraged more people to take up the earnings supplement, and it appeared to have long-term effects on full-time employment and welfare receipt. This might be because the services improved the jobs people obtained. Both earnings and wage rates were higher compared to earnings and wages without the services and the jobs held appeared to be more sustainable.

Suggested Citation

  • Phillip K. Robins & Charles Michalopoulos & Kelly Foley, 2006. "Are Two Carrots Better Than One? The Effects of Adding Employment Services to Financial Incentive Programs for Welfare Recipients," Working Papers 0713, University of Miami, Department of Economics, revised Oct 2007.
  • Handle: RePEc:mia:wpaper:0713
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    File URL: http://scholarlyrepository.miami.edu/cgi/viewcontent.cgi?article=1003&context=economics_articles&sei-redir=1&referer=http%3A%2F%2Fwww.google.com%2Furl%3Fsa%3Dt%26rct%3Dj%26q%3Dare%2520two%2520carrots%2520better%2520than%2520one%253F%2520the%2520effects%2520of%2520adding%2520employment%2520services%2520to%2520financial%2520incentive%2520programs%2520for%2520welfare%2520recipients%26source%3Dweb%26cd%3D4%26ved%3D0CEQQFjAD%26url%3Dhttp%253A%252F%252Fscholarlyrepository.miami.edu%252Fcgi%252Fviewcontent.cgi%253Farticle%253D1003%2526context%253Deconomics_articles%26ei%3DvsCFT6_RK4OQ9gTPlKXMCA%26usg%3DAFQjCNHuRPa53LHQHjMPcMuVwOTTeaQiPg#search=%22two%20carrots%20better%20than%20one%3F%20effects%20adding%20employment%20services%20financial%20incentive%20programs%20welfare%20recipients%22
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    Citations

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    Cited by:

    1. Alexander Spermann, 2015. "How to fight long-term unemployment: lessons from Germany," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-15, December.
    2. Richard Hendra & James Riccio & Richard Dorsett & Philip Robins, 2015. "Breaking the low pay, no pay cycle: the effects of the UK Employment Retention and Advancement programme," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-32, December.
    3. Dorsett, Richard, 2014. "The effect of temporary in-work support on employment retention: Evidence from a field experiment," Labour Economics, Elsevier, vol. 31(C), pages 61-71.
    4. Christopher J. O'Leary, 2015. "Use of Unemployment Insurance and Public Employment Services after Leaving Welfare," Upjohn Working Papers and Journal Articles 15-235, W.E. Upjohn Institute for Employment Research.
    5. Dr Richard Dorsett, 2013. "Can Post-Employment Services Combined with Financial Incentives Improve Employment Retention for Welfare Recipients? Evidence from the Texas Employment Retention and Advancement Evaluation," National Institute of Economic and Social Research (NIESR) Discussion Papers 409, National Institute of Economic and Social Research.
    6. Nathan Berg & Todd Gabel, 2013. "Effects of New Welfare Reform Strategies on Welfare Participation: Microdata Estimates from Canada," Working Papers 1304, University of Otago, Department of Economics, revised Feb 2013.
    7. Stephen A. Wandner, 2016. "Wage Insurance as a Policy Option in the United States," Upjohn Working Papers and Journal Articles 16-250, W.E. Upjohn Institute for Employment Research.

    More about this item

    Keywords

    Labor supply; social program evaluation; welfare policy;

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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