EconPapers    
Economics at your fingertips  
 

What Do NEETs Need? The Effect of Combining Activation Policies and Cash Transfers

Francesco Filippucci
Additional contact information
Francesco Filippucci: PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

PSE Working Papers from HAL

Abstract: Activation policies and cash transfers are often used jointly, but the literature has only evaluated them one conditional on the other. This paper evaluates an innovative French program that provided a year of cash transfers and intensive activation measures to disadvantaged youth Not in Employment Education or Training (NEETs). I develop a difference-indifference methodology that extends De Chaisemartin and D'Haultfoeuille (2020a) to a setting where individuals enter the population of interest in cohorts. While no significant effect was found when participants are enrolled, after completion of the program compliers reported an increase of 33 percentage points in the probability of employment and of 72 hours worked on a quarterly basis. No effect was detected on wages. I investigate the mechanisms using the timing of activation measures, the phase-out of the cash transfer, and a framework with discrete labor supply and search frictions. I find that the zero effect during enrollment arises from a negative reaction to implicit taxation from transfer phase-out, lock-in from training, and a counterbalancing positive effect of activation. This finding suggests potential complementarities between cash transfers and activation measures. Moreover, it shows that disadvantaged NEETs have low job finding rates at baseline, large elasticity of labor supply, and significant time constraints.

Keywords: Active labor market policies; Cash transfers; NEETs; Job search; Difference-in-difference (search for similar items in EconPapers)
Date: 2022-01
New Economics Papers: this item is included in nep-cwa
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-03524083
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://shs.hal.science/halshs-03524083/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:psewpa:halshs-03524083

Access Statistics for this paper

More papers in PSE Working Papers from HAL
Bibliographic data for series maintained by CCSD ().

 
Page updated 2023-02-14
Handle: RePEc:hal:psewpa:halshs-03524083