Targeting Labour Market Programmes – Results from a Randomized Experiment

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Stefanie Behncke; Markus Frölich; Michael Lechner

Targeting Labour Market Programmes – Results from a Randomized Experiment (2009)

Published research article · 145(3), 221–268

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Full Caseworker Discretion and System Sabotage

"Without strong incentives or coercion, caseworkers may ignore or sabotage a system that is intended to provide information only."

Caseworker-Level Randomization in Policy Evaluation

"A randomization at the level of the caseworker was preferred to a randomization at the level of the employment office or at the level of the unemployed person... A randomization at the level of the unemployed person, on the other hand, would have led to the problem that a caseworker would receive employment predictions for some of his clients but not for others... produce spill over effects."

Dynamic Covariate Updating in Treatment Selection

"The predictions were updated every second week by incorporating new information on time varying covariates (in particular unemployment duration). This is a big advantage vis-à-vis simple profiling models as it takes into account that the optimal time when a labour market programme should start may also vary across individuals."

Feasibility-Constrained Programme Aggregation

"By defining a category language skills training which includes German, French and foreign language courses, this category becomes feasible for every jobseeker, and the X_it characteristics (e.g. mother tongue, profession) define which type of language course or further training is appropriate."

Institutional Friction and Algorithmic Threat Perception

"SOMS, however, was never implemented mainly because of data security concerns and because of resistance from frontline caseworkers who perceived SOMS as a threat to their own job security... The SOMS database was deleted in 2002, before SOMS ever was tried in the field."

Instrumental Variable Estimation under One-Sided Non-Compliance

"Since it was impossible for the members of the control group to download the predictions the monotonicity condition of IMBENS and ANGRIST (1994) is satisfied by definition, and this also means that the local average treatment effect (LATE) is the same as the average treatment effect on the treated (ATET) because the treated are the compliers."

Mandatory Caseworker Rotation and Experimental Contamination (Dossierwechsel)

"In many offices, the caseworker is changed if the jobseeker stays unemployed for more than 6 or 8 months, with the intention to introduce new ideas in the job search process... In most of the analyses, we will define treatment status of the jobseeker as time-invariant according to the randomization status of the first caseworker."

Multi-Register Administrative Data Linkage for Counterfactual Estimation

"This data set was matched with the complete monthly information from the social security and pensions system (AHV) for the period January 1990 to December 2002. These combined data sources contain very detailed information on registration and de-registration of unemployment, benefit payments and sanctions, participation in ALMP, eleven years employment histories with monthly information on earnings and employment status."

Multiple Comparison with the Best (MCB) for Statistical Treatment Selection

"The statistical precision of the estimates was also conveyed to the caseworker in that the set of all programmes was divided into three groups: The significantly best programmes, the intermediate programmes, and the worst programmes... estimated by Multiple Comparison with the Best (MCB) routines."

Principal-Agent Objective Misalignment in Decentralized Bureaucracies

"Indeed, when asked in a written questionnaire, around 40% of Swiss caseworkers reported 'improving their clients personal situation', while 35% reported 'long-run reintegration' and 25% 'rapid reintegration' as their primary goal for low qualified unemployed (FRÖLICH et al., 2007)."

Statistical Targeting vs. Profiling Systems

"Targeting is preferable to profiling if a variety of heterogeneous labour market programmes are offered... and if the long-term unemployment risk is not highly correlated with programme impacts."

Statistically Assisted Programme Selection (SAPS)

"The evaluation results show that caseworkers did not change their behaviour in any significant way due to having access to the additional information. Caseworkers either decided to ignore the system or were over-confident in that their own experience clearly dominates any information that a statistical system might provide."

Stock vs. Flow Sampling in Program Evaluation

"We therefore distinguish in the later analyses between a stock and a flow sample. The stock sample contains all jobseekers who were already registered at the beginning of the field study... The flow sample contains all jobseekers who entered later."