Working Paper: CEPR ID: DP2451
Authors: Rafael Lalive; Jan C. van Ours; Josef Zweimüller
Abstract: We evaluate the effect of active labour market programs on the duration of unemployment in a reward or punish system. In Switzerland, unemployment benefits are conditional upon program attendance after 7 months of unemployment duration. In the evaluation we allow for selectivity affecting the inflow into programs. Our results indicate that(i) After ALMP-participation the transition rate to jobs increases for Swiss women but not for Swiss men. However, the job hazard rate is strongly reduced during participation. Taken together, this leads to the conclusion that programs prolong unemployment duration for men, but tend to shorten duration for women.(ii) Once the unemployment spell approaches the expiration of unconditional benefit entitlement the job-hazard rate increases strongly, both for women and for men.(iii) We do not find important selectivity effects, neither for males, nor females.
Keywords: active labour market policy; benefit entitlement; treatment effect; bivariate duration model
JEL Codes: C14; C41; I38; J64
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| ALMP participation (J68) | job transition rate for Swiss women (J62) |
| ALMP participation (J68) | job hazard rate for both genders (J28) |
| ALMP participation (J68) | unemployment duration for men (J64) |
| ALMP participation (J68) | unemployment duration for women (J64) |
| benefit expiration (H55) | job hazard rate for both genders (J28) |
| selectivity effects (C24) | ALMP participation for females (J79) |
| selectivity effects (C24) | ALMP participation for males (J68) |