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Estimating Equilibrium Effects of Job Search Assistance

Journal article
Authors P. Gautier
B. van der Klaauw
Paul Muller
M. Rosholm
M. Svarer
Published in Journal Labor Economics
Volume 36
Issue 4
ISSN 0734-306X
Publication year 2018
Published at Department of Economics
Language en
Keywords job search, randomized experiment, policy relevant treatment effects, externalities, indirect inference
Subject categories Economics


Identifying policy relevant treatment effects from randomized experiments requires the absence of spillovers between participants and nonparticipants (SUTVA) or variation in observed treatment levels. We find that SUTVA is violated for a Danish activation program for unemployed workers. Using a difference-in-difference model we show that nonparticipants in the experiment regions find jobs slower after the introduction of the program, relative to workers in other regions. We estimate an equilibrium search model to identify the policy relevant treatment effect. A large-scale roll out of the program is shown to decrease welfare, while a standard partial microeconometric cost-benefit analysis concludes the opposite.

Page Manager: Webmaster|Last update: 9/11/2012

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