Screening through Activation? Differential Effects of a Youth Activation Program

We study the dual role of active labor market policies. First, active labor market programs (ALMPs) may perform a screening role by increasing job-search incentives already before program participation, especially among individuals with good labor market prospects. Second, actual program participati...

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Bibliographic Details
Published in:The Journal of human resources 2022-05, Vol.57 (3), p.1033-1077
Main Authors: Hall, Caroline, Kotakorpi, Kaisa, Liljeberg, Linus, Pirttilä, Jukka
Format: Article
Language:English
Subjects:
Children & youth
COVID-19
Discontinuity
Job hunting
Labor market
Medical screening
Probability
Prospects
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Summary:We study the dual role of active labor market policies. First, active labor market programs (ALMPs) may perform a screening role by increasing job-search incentives already before program participation, especially among individuals with good labor market prospects. Second, actual program participation may help individuals with poor labor market prospects. We examine whether this type of pattern can be found in individual responses to a nationwide youth activation program in Sweden using a regression discontinuity (RD) design. We find that individuals with a high predicted probability of finding work respond to the threat of activation, whereas there is no effect for individuals with weak labor market prospects.
ISSN:0022-166X
1548-8004
1548-8004
DOI:10.3368/jhr.57.3.1117-9182R1