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Estimating the Threat Effect of Active Labour Market Programmes

Author

Listed:
  • Michael Rosholm

    (Department of Economics, University of Aarhus)

  • Michael Svarer

    (Department of Economics, University of Aarhus)

Abstract
We combine two techniques to consistently estimate the effect of active labour market programmes and, in particular, active labour market policy regimes. Our aim is to explicitly estimate the threat effect of active labour market programmes. Based on Danish data (1998-2002) from administrative registers we find a strong and significantly positive threat effect. The threat effect is shown to reduce average unemployment duration by approximately three weeks. The implications of this result are discussed.

Suggested Citation

  • Michael Rosholm & Michael Svarer, 2004. "Estimating the Threat Effect of Active Labour Market Programmes," CAM Working Papers 2004-14, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics.
    • Handle: RePEc:kud:kuieca:2004_14
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    File URL: http://www.econ.ku.dk/cam/wp0910/wp0203/2004-14.pdf/
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    References listed on IDEAS

    as
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    20. Bolvig, Iben & Jensen, Peter & Rosholm, Michael, 2003. "The Employment Effects of Active Social Policy," IZA Discussion Papers 736, Institute of Labor Economics (IZA).
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    More about this item

    Keywords

    active labour market policy; threat effect; timing-of-events; duration model;
    All these keywords.

    JEL classification:

    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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