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- Title
The decentralization of public employment services and local governments' responses to incentives.
- Authors
Nieminen, Jeremias; Kanninen, Ohto; Karhunen, Hannu
- Abstract
We examine how the decentralization of public employment services (PES) affects the behavior and service provision of PES offices and the labor market outcomes of job seekers. We use difference-in-differences, utilizing a Finnish temporary reform during which PES were decentralized for specific groups of job seekers in treated municipalities and remained centralized for others. The reform presented the treated municipalities with the possibility of shifting costs to the central government. We find no evidence of better labor market outcomes and find evidence consistent with municipalities being able to shift 10% of their unemployment benefit costs to the central government.
- Subjects
MUNICIPAL services; UNEMPLOYMENT insurance; FEDERAL government; COST shifting; EMPLOYMENT agencies
- Publication
Journal of Economic Geography, 2023, Vol 23, Issue 6, p1371
- ISSN
1468-2702
- Publication type
Article
- DOI
10.1093/jeg/lbad027