In Simple Words
Imagine living in an isolated suburban town with no money for bus fare; job searches are restricted strictly to walkable neighborhood stores. Providing a free bus pass enables travel to the city center, allowing exploration of a wider market with higher-paying job opportunities.
Young job seekers in Ethiopia
- Study comparison group
- Group used for comparison
- Transport subsidies
- Better-quality jobs
The Ethiopian evaluation reported better-quality work and reduced discouragement with transport subsidies, without increasing overall employment. This figure selects the Ethiopian job-quality result on the card rather than merging it with the South African or Jordanian evaluations.
See source →Research question
High transportation costs create spatial search frictions that restrict low-income job seekers to localized geographic areas. Financial constraints prevent unemployed individuals from traveling to central commercial hubs, reducing job search intensity and match quality.
Participants
Unemployed youth in Addis Ababa (Ethiopia), job-seeking youth in Johannesburg (South Africa), and displaced Syrian refugees in Jordan.
Study Design
Randomized Controlled Trials (RCTs) testing cash transfers and transport subsidies for job search activities.
Results
In Ethiopia, transport subsidies helped youth secure higher-quality employment and reduced job seeker discouragement. In South Africa, transit subsidies to access city centers adjusted wage expectations toward realistic market rates and increased acceptance of jobs closer to home. In Jordan, direct cash transfers significantly increased job search effort, employment rates, and total earnings among refugees.
Takeaway
Distribute targeted transit subsidies or cash stipends via public employment centers to low-income unemployed individuals during active search periods.
Source and citation
See source →Evidence in Labor Market Policies and Implications for Brazil: Job Search Assistance
Copyright © 2023 Inter-American Development Bank.
Full source notice
Copyright © 2023 Inter-American Development Bank ("IDB"). This work is subject to a Creative Commons license CC BY 3.0 IGO (https://creativecommons.org/licenses/by/3.0/igo/legalcode). The terms and conditions indicated in the URL link must be met and the respective recognition must be granted to the IDB. Further to section 8 of the above license, any mediation relating to disputes arising under such license shall be conducted in accordance with the WIPO Mediation Rules. Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the United Nations Commission on International Trade Law (UNCITRAL) rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this license. Note that the URL link includes terms and conditions that are an integral part of this license.