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Incentivizing last-resort social assistance clients: Evidence from a Finnish policy experiment

Author

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  • Palviainen Heikki

    (Faculty of Management and Business, Tampere University)

Abstract

In 2002, the Finnish government introduced an earnings disregard experiment aimed at improving the incentives of low-income individuals who receive last-resort social as- sistance. The aim of the experiment was to reduce unemployment by providing social assistance clients better incentives to receive at least temporary or part-time work. This paper evaluates the employment effects of the experiment as an event study using coars- ened exact matching (CEM) and difference-in-differences. On average, the results show no employment effects, but there is some evidence on positive employment effects on women.

Suggested Citation

  • Palviainen Heikki, 2021. "Incentivizing last-resort social assistance clients: Evidence from a Finnish policy experiment," Working Papers 2132, Tampere University, Faculty of Management and Business, Economics.
    • Handle: RePEc:tam:wpaper:2132
    as

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    File URL: http://urn.fi/URN:ISBN:978-952-03-2181-9
    File Function: Third version, 2021
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Difference-in-differences; making work pay; earnings disregard; welfare;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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