Locus of Control Effort Allocation
RCTClinical Trial
Individual psychological beliefs regarding agency determine whether jobseekers prioritize long-term human capital investments or short-term job search. Jobseekers who believe outcomes depend on personal actions focus on skill acquisition, whereas those believing outcomes depend on external factors rely more on passive transfer payments and immediate employment search.
Picture this
Think of two people playing a game of skill. The first person believes winning depends entirely on practice, so they spend all their time taking lessons and improving their technique, ignoring quick matches. The second person believes winning is just random luck, so they stop practicing and focus on playing as many quick games as possible to collect attendance rewards.
What the evidence says
Jobseekers with an internal locus of control demonstrated higher baseline human capital investment index scores (+5.16 vs -5.00) and lower search effort index scores (-4.35 vs +4.42) compared to those with an external locus of control. Cash transfers generated significant net income gains for external locus youth (€22.86 increase, p < 0.01), whereas internal locus youth actively adjusted income sources resulting in no significant net income change (€7.69, p > 0.10).
- Who was studied
- Subgroup sample of N = 3,270 young jobseekers aged 18–22 across 82 French Job Youth Centers split by median baseline locus of control scores.
- How
- Randomized controlled trial (RCT) evaluating treatment effect heterogeneity across internal versus external locus of control subgroups measured via baseline survey items.
What to do
Assess client locus of control prior to counseling to pair external locus individuals with structured guidance and direct job matching while providing internal locus individuals with long-term skill acquisition tracks.
From the source
"In line with Prediction 1, mean human capital investment is significantly higher for those with an internal locus of control - i.e., for those who believe their life is shaped by their own actions, rather than by external factors. Interestingly, and similar to the findings for patience, search effort is significantly lower for those with an internal locus, consistent with a more long-term focus on building human capital."
Conditional_Cash_Transfers_on_the_Labor_Market_Evidence_from_Young.pdf