Incentive-based active labor market programs: Insights from policy experimentation in Italy

Giulio Zanella and Riccardo Salomone

Labour Economics, 2025, vol. 93, issue C

Abstract: Two programs providing financial incentives for reemployment of workers at risk of long-term unemployment are evaluated vis-à-vis intensive job-search assistance through policy experimentation involving about 10,000 job seekers in Italy: (i) a reemployment voucher that incentivizes specialized providers; (ii) a reemployment bonus that incentivizes job seekers directly. Results indicate that: the voucher is effective for men while the bonus works for women; each policy is no less effective than job-search assistance, but only the voucher is clearly cost effective; there are no side effects on post-treatment earnings or job duration. A one-sided job search model with endogenous search effort rationalizes these empirical findings.

Keywords: Reemployment voucher; Reemployment bonus; Job search assistance; Active labor market policy (search for similar items in EconPapers)
JEL-codes: J64 J65 J68 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:labeco:v:93:y:2025:i:c:s0927537125000144

DOI: 10.1016/j.labeco.2025.102687

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