Working Paper: NBER ID: w18597
Authors: Bruno Crépon; Esther Duflo; Marc Gurgand; Roland Rathelot; Philippe Zamora
Abstract: This paper reports the results from a randomized experiment designed to evaluate the direct and indirect (displacement) impacts of job placement assistance on the labor market outcomes of young, educated job seekers in France. We use a two-step design. In the first step, the proportions of job seekers to be assigned to treatment (0%, 25%, 50%, 75% or100%) were randomly drawn for each of the 235 labor markets (e.g. cities) participating in the experiment. Then, in each labor market, eligible job seekers were randomly assigned to the treatment, following this proportion. After eight months, eligible, unemployed youths who were assigned to the program were significantly more likely to have found a stable job than those who were not. But these gains are transitory, and they appear to have come partly at the expense of eligible workers who did not benefit from the program, particularly in labor markets where they compete mainly with other educated workers, and in weak labor markets. Overall, the program seems to have had very little net benefits.
Keywords: Labor Market Policies; Displacement Effects; Job Placement Assistance; Randomized Experiment
JEL Codes: C93; J64; J68
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| competition among treated individuals (L13) | magnitude of displacement effects (C22) |
| eligible unemployed youths assigned to the program (J68) | secure a fixed-term contract of over six months (J63) |
| untreated workers in treated areas (J68) | secure a long fixed-term contract (J41) |
| eligible unemployed youths assigned to the program (J68) | displacement effect on untreated workers (J65) |