The Wage Effect of a Social Experiment on Intensified Active Labor Market Policies
Study Paper No. 49
Written by: Signe Hald Andersen
This paper presents an investigation of the effect of extra attention by a job centre to an unemployed individual. What is the outcome of additional contact with an unemployed person on the transition to employment and the wages obtained? The study is based on a social experiment conducted by Danish county authorities in 2005 and 2006. Around 5,000 unemployed individuals were randomly assigned to receive either normal treatment or a more intensive treatment at the job centre. The paper documents that participation in the intensive programme increased the likelihood of finding employment in the short term, but at the same time resulted in a reduction in wages.
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