Monitoring, Sanctions and Front-Loading of Job Search in a Non-Stationary Model

Bart Cockx, Muriel Dejemeppe, Andrey Launov () and Bruno Van der Linden

No 1114, Working Papers from Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz

Abstract: We develop and estimate a non-stationary job search model to evaluate a scheme that monitors job search effort and sanctions insured unemployed whose effort is deemed insufficient. The model reveals that such schemes provide incentives to the unemployed to front-load search effort prior to monitoring. This causes the job finding rate to increase above the post sanction level. After validating the model both internally and externally, we conclude that the scheme is effective in raising the job finding rate with minor wage losses. A basic cost-benefit analysis demonstrates that welfare losses for the unemployed are compensated by net efficiency gains for public authorities and society.

Keywords: Monitoring; sanctions; non-stationary job search; unemployment benefits; structural estimation (search for similar items in EconPapers)
JEL-codes: C41 J64 J68 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2011-11-21, Revised 2011-11-21
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (14)

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https://download.uni-mainz.de/RePEc/pdf/Discussion_Paper_1114.pdf First version, 2011 (application/pdf)

Related works:
Working Paper: Monitoring, Sanctions and Front-Loading of Job Search in a Non-Stationary Model (2011)
Working Paper: Monitoring, Sanctions and Front-Loading of Job Search in a Non-Stationary Model (2011)
Working Paper: Monitoring, Sanctions and Front-Loading of Job Search in a Non-Stationary Model (2011)
Working Paper: Monitoring, Sanctions and Front-Loading of Job Search in a Non-Stationary Model (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:jgu:wpaper:1114

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