Labor Market Policy Evaluation in Equilibrium: Some Lessons of the Job Search and Matching Model

Pierre Cahuc and Thomas Le Barbanchon

No 3687, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We analyze the consequences of counseling provided to job seekers in a standard job search and matching model. It turns out that neglecting equilibrium effects induced by counseling can lead to wrong conclusions. In particular, counseling can increase steady state unemployment although counseled job seekers exit unemployment at a higher rate than the non-counseled. Dynamic analysis shows that permanent and transitory policies can have effects of opposite sign on unemployment.

Keywords: equilibrium effect; labor market policy; evaluation (search for similar items in EconPapers)
JEL-codes: J64 J68 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2008-09
New Economics Papers: this item is included in nep-dge, nep-lab and nep-ltv
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Published - published in: Labour Economics, 2010, 17 (1), 196-205

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Related works:
Journal Article: Labor market policy evaluation in equilibrium: Some lessons of the job search and matching model (2010)
Working Paper: Labor Market Policy Evaluation in Equilibrium: Some Lessons of the Job Search and Matching Model (2009)
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