Counseling and Monitoring of Unemployed Workers: Theory and Evidence from a Controlled Social Experiment
56 Pages Posted: 14 Oct 2001
Date Written: October 2001
We investigate the effect of counseling and monitoring on the individual transition rate to employment. We theoretically analyze these policies in a job search model with two search channels and endogenous search effort. In the empirical analysis we use unique administrative and survey data concerning a social experiment with full randomization and compliance. The results show that counseling and monitoring do not affect the exit rate to work. Monitoring causes a shift from informal to formal job search. We combine our empirical results to the results from our theoretical analysis and the existing empirical literature, to establish a comprehensive analysis of the effectiveness of these policies.
Keywords: Unemployment Duration, Search Effort, Active Labor Market Policy, Treatment, Search Channels, Multi-Tasking, Randomized Social Experiment
JEL Classification: J64, J65, J58
Suggested Citation: Suggested Citation