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What is the Value Added by Caseworkers?

Michael Lechner & JeffreyA. Smith

abstract We investigate the allocation of unemployed individuals to different subprograms within Swiss active labour market policy by the caseworkers at local employment offices in Switzerland in 1998. We are particularly interested in whether the caseworkers allocate the unemployed to services in ways that will maximize the program-induced changes in their employment probabilities. Our econometric analysis uses unusually informative data originating from administrative unemployment and social security records. For the estimation we apply matching estimators adapted to the case of multiple programmes. The number of observations in this database is sufficiently high to allow for this nonparametric analysis to be conducted in narrowly defined subgroups. Our results indicate that Swiss caseworkers do not do a very good job of allocating their unemployed clients to the subprograms so as to maximize their subsequent employment prospects. Our findings suggest one of three possible conclusions. First, caseworkers may be trying to solve the problem of allocating the unemployed to maximize their subsequent employment, but may lack the skills or knowledge to do this. Second, caseworkers may have a goal other than efficiency, such as allocating the most expensive services to the least well-off clients, that is not explicit in the law regulating active labour market policies. Third, the distortions of the local decision process could be due to federal authorities imposing strict minimum participation requirements for the various programs at the regional level. (doi:10.1016/j.labeco.2004.12.002)
   
type journal paper
   
keywords targeting
   
language English
kind of paper journal article
date of appearance 1-4-2007
journal Labour Economics
publisher Elsevier (Amsterdam)
ISSN 0927-5371
volume of journal 14
number of issue 2
page(s) 135-151
review not reviewed
   
citation Lechner, M., & Smith, J. (2007). What is the Value Added by Caseworkers?. Labour Economics, 14(2), 135-151.