Authors	van den Berg, G.J, Bergemann, A. and Caliendo, M.
Year	2009
Reference	Journal of the European Economic Association (P&P), 7(2-3), 606-616.
Keywords	Policy evaluation, reservation wage, search effort, expectations, unemployment duration, program evaluation, active labor market policy, identification
JEL-Classification	J64, C21, D83, D84
Presentations	EEA, Milano 2008.
Download	IZA Discussion Paper from November 2008: PDF
Abstract	Labor market programs may affect unemployed individuals’ behavior before they enroll. Such ex ante effects are hard to identify without model assumptions. We develop a novel method that relates self-reported treatment rates and job search behavioral outcomes, like the reservation wage, among newly unemployed workers. We use job search theory to derive theoretical predictions. To deal with effect heterogeneity and selectivity, we advocate propensity score matching to estimate the effects of interest. We apply the method to the German ALMP system, using a novel data set including self-reported assessments of the variables of interest as well as an unusually detailed amount of information on behavior, attitudes, and past outcomes. We find that the system generates a negative ex ante effect on the reservation wage and a positive effect on search effort.