Structural empirical evaluation of job search monitoring

Gerard J. van den Berg*, Bas van der Klaauw

*Corresponding author for this work

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To evaluate search effort monitoring of unemployed workers, it is important to take account of post-unemployment wages and job-to-job mobility. We structurally estimate a model with search channels, using a controlled trial in which monitoring is randomized. The data include registers and survey data on search behavior. We find that the opportunity to move to better-paid jobs in employment reduces the extent to which monitoring induces substitution toward formal search channels in unemployment. Job mobility compensates for adverse long-run effects of monitoring on wages. We examine counterfactual policies against moral hazard, like reemployment bonuses and changes of the benefits path.

Original languageEnglish
Pages (from-to)879-903
Number of pages25
JournalInternational Economic Review
Issue number2
Early online date18 Oct 2018
Publication statusPublished - May 2019

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