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Leaving Poverty Behind? The Effects of Generous Income Support Paired with Activation

Simen Markussen () and Knut Røed ()

No 8245, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We evaluate a comprehensive activation program in Norway targeted at hard-to-employ social assistance claimants with reduced work capacity. The program offers a combination of tailored rehabilitation, training and job practice, and a generous, stable, and non-means-tested benefit. Its main aims are to mitigate poverty and subsequently promote self-supporting employment. Our evaluation strategy exploits a geographically staggered program introduction, and the causal effects are identified on the basis of changes in employment prospects that coincide with local program implementation in a way that correlates with the predicted probability of becoming a participant. We find that the program raised employment prospects considerably.

Keywords: treatment effects; social insurance; vocational rehabilitation; poverty; program evaluation (search for similar items in EconPapers)
JEL-codes: C21 C26 H55 I30 J24 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ias and nep-lma
Date: 2014-06
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Published in: American Economic Journal: Economic Policy, 2016, 8 (1), 180–211

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