Private Deception and the Rise of Public Employment Offices in the United States, 1890 - 1930

Woong Lee

No 13695, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: At the turn of the 20th century, state and local governments in the United States began to establish public employment offices. These non-profit governmental organizations match job seekers and businesses, one of their main objectives being to protect job seekers from fraudulent activities by private employment agencies. In this paper, I propose a theory that describes the malpractices of private employment agencies as a situation of asymmetric information between job seekers and the private employment agencies, which could cause adverse selection in the labor exchange market. The establishment of public employment offices can be viewed as a policy device to eliminate low-quality private employment agencies committing malpractices. I show that public employment offices helped lower the degree of asymmetric information. The majority of job seekers who used public employment offices were unskilled workers, immigrants, or migrants, who were vulnerable to exploitation by private employment agencies. I also find that the role of public employment offices was especially important for interstate migrants who were most lacking in information and networks in their new environment.

JEL-codes: J4 N3 N4 (search for similar items in EconPapers)
Date: 2007-12
New Economics Papers: this item is included in nep-his, nep-lab and nep-mig
Note: LS
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published as Woong Lee, 2009. "Private Deception and the Rise of Public Employment Offices in the United States, 1890-1930," NBER Chapters, in: Studies of Labor Market Intermediation, pages 155-181 National Bureau of Economic Research, Inc.

Downloads: (external link)
http://www.nber.org/papers/w13695.pdf (application/pdf)

Related works:
Chapter: Private Deception and the Rise of Public Employment Offices in the United States, 1890-1930 (2009)
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:nbr:nberwo:13695

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w13695

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().