Transport Search Cost Subsidy
High physical transit costs prevent young job-seekers in city peripheries from traveling frequently to central job vacancy boards, restricting active search intensity and application volume.
Picture this
Imagine a fisherman who cannot afford boat fuel to reach a rich deep-sea fishing spot in the town center, so he stays near the shore catching small fish. Giving him a temporary fuel voucher allows him to travel to the deep-water market every day, but once the voucher ends, if he has not secured a permanent boat spot, he returns to the shore.
What the evidence says
Transit subsidies increased **active search likelihood by 12.5%** (5 percentage points, p < 0.05) and **job board visits by 30%** (9 percentage points) during intervention weeks, raising 1-year formal job rates by 5.4 percentage points (p < 0.01), but generating **no statistically significant long-term earning gains** after four years (30.9 ETB, p = 0.753).
- Who
- **N = 774 treated individuals** (human, aged 18–29, high school educated) across 74 geographical clusters in Addis Ababa, Ethiopia [13-15].
- How
- **Randomized Controlled Trial (RCT)** providing conditional daily transit cash transfers (13–20 weeks duration, median 16 weeks) with fortnightly phone monitoring and 4-year follow-up [13, 14, 16].
What to do
Provide temporary, conditional travel vouchers to unemployed youth to cover commuting expenses to centralized job vacancy boards during active job-hunting periods.
From the source
"We find confirmation that search costs are a significant barrier to job search. However, in our representative sample these effects are weak and ultimately short lived."
Anonymity or Distance? Job Search and Labour Market Exclusion in a Growing African City