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Dynamic effects of mandatory activation of welfare participants

Author

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  • Persson, Anna

    (Uppsala Center for Fiscal Studies)

  • Vikman, Ulrika

    (Uppsala Center for Fiscal Studies)

Abstract

Previous literature shows that activation requirements for welfare participants decrease welfare participation. However, the dynamics have not been examined, and often only exit effects are analyzed. In this paper, we look more closely at the transition rates into and out of welfare. Using register data on the entire population of Stockholm, we are able to capture how both entry and exit rates were affected when activation requirements were introduced at different times in Stockholm’s city districts. The results indicate that the main reduction in welfare participation is due to a small increase in exit rates. The part of the population that is at risk of entering into welfare, though, experiences a reduction in entry rates due to the reform. There are also heterogeneous effects, namely, large effects on entry rates for young individuals. In addition, there are larger effects on exit rates for unmarried individuals without children compared to the population as a whole.

Suggested Citation

  • Persson, Anna & Vikman, Ulrika, 2010. "Dynamic effects of mandatory activation of welfare participants," Working Paper Series, Center for Fiscal Studies 2010:5, Uppsala University, Department of Economics.
    • Handle: RePEc:hhs:uufswp:2010_005
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    Cited by:

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    2. Forslund, Anders, 2019. "Employment outcomes and policies in Sweden during recent decades," Working Paper Series 2019:15, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    3. Marcela Kantová & Šárka Prudká & Markéta Arltová & Magdaléna Kotýnková, 2018. "Efektivita trhu práce ve světle opatření konceptu flexikurity: příklad České republiky a Švédska v období 20062015 [Efficiency of Labour Market Policy Changes in the Czech Republic and Sweden in 20," Politická ekonomie, Prague University of Economics and Business, vol. 2018(4), pages 411-429.
    4. Persson, Anna, 2011. "Earnings, income and poverty among welfare leavers in Sweden," Working Paper Series 2011:17, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    5. Cammeraat, Emile & Jongen, Egbert L. W. & Koning, Pierre, 2017. "Preventing NEETs during the Great Recession: The Effects of a Mandatory Activation Program for Young Welfare Recipients," IZA Discussion Papers 11090, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Welfare reform; mandatory activation program; welfare entry; welfare exit;
    All these keywords.

    JEL classification:

    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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