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Does privatisation of vocational rehabilitation improve labour market opportunities? Evidence from a field experiment in Sweden

Author

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  • Jönsson, Lisa

    (Department of Economics, Stockholm University)

  • Skogman Thoursie, Peter

    (IFAU - Institute for Labour Market Policy Evaluation)

Abstract

This paper analyses if privatisation of vocational rehabilitation can improve labour market opportunities for individuals on long-term sickness absence. We use a field experiment performed by the Employment Service and the Social Insurance Agency in Sweden during 2008 to 2010, in which over 4,000 participants were randomly offered private and public rehabilitation. We find no differences in employment rates following rehabilitation between individuals who received rehabilitation by private and public providers. Also the average cost of rehabilitation was essentially equal for the two types of providers. This suggests that there are no large efficiency gains from privatising vocational rehabilitation.

Suggested Citation

  • Jönsson, Lisa & Skogman Thoursie, Peter, 2012. "Does privatisation of vocational rehabilitation improve labour market opportunities? Evidence from a field experiment in Sweden," Working Paper Series 2012:2, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    • Handle: RePEc:hhs:ifauwp:2012_002
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    2. Nicolas R. Ziebarth, 2018. "Social Insurance and Health," Contributions to Economic Analysis, in: Health Econometrics, volume 127, pages 57-84, Emerald Group Publishing Limited.
    3. Pedersen, Morten Saaby & Arendt, Jacob Nielsen, 2014. "Bargaining for health: A case study of a collective agreement-based health program for manual workers," Journal of Health Economics, Elsevier, vol. 37(C), pages 123-136.
    4. Knutsson, Daniel & Tyrefors, Björn, 2020. "The Quality and Efficiency Between Public and Private Firms: Evidence from Ambulance Services," Working Paper Series 1365, Research Institute of Industrial Economics, revised 01 Jul 2021.
    5. Bart Cockx & Stijn Baert, 2015. "Contracting Out Mandatory Counselling and Training for Long-Term Unemployed. Private For-Profit or Non-Profit, or Keep it Public?," LIDAM Discussion Papers IRES 2015022, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    6. Bruno Crépon & Gerard J. van den Berg, 2016. "Active Labor Market Policies," Annual Review of Economics, Annual Reviews, vol. 8(1), pages 521-546, October.
    7. Gesine Stephan, 2016. "Public or private job placement services—Are private ones more effective?," IZA World of Labor, Institute of Labor Economics (IZA), pages 285-285, August.
    8. Tomasz Gajderowicz & Maciej Jakubowski, 2019. "What Works for Disadvantaged Unemployed: Private or Public ALMP Services? Evidence from Poland," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 332-346.
    9. Rehwald, Kai & Rosholm, Michael & Svarer, Michael, 2015. "Are Public or Private Providers of Employment Services More Effective? Evidence from a Randomized Experiment," IZA Discussion Papers 9365, Institute of Labor Economics (IZA).
    10. Fredrik Andersson & Henrik Jordahl & Jens Josephson, 2019. "Outsourcing Public Services: Contractibility, Cost, and Quality," CESifo Economic Studies, CESifo Group, vol. 65(4), pages 349-372.
    11. Rehwald, Kai & Rosholm, Michael & Svarer, Michael, 2017. "Do public or private providers of employment services matter for employment? Evidence from a randomized experiment," Labour Economics, Elsevier, vol. 45(C), pages 169-187.
    12. Fontenay, Sébastien & Tojerow, Ilan, 2022. "How Does Job Coaching Help Disability Insurance Recipients Work While on Claim?," IZA Discussion Papers 15386, Institute of Labor Economics (IZA).
    13. Gerdes, Christer, 2015. "Does Performance Information Affect Job Seekers in Selecting Private Providers in Voucher-Based ALMP Programs?," IZA Discussion Papers 8992, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Vocational rehabilitation; Privatisation; Field experiment;
    All these keywords.

    JEL classification:

    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out

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