Engineering an incentive to search for work: A comparison groups approach

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URI: http://hdl.handle.net/10900/63571
http://nbn-resolving.de/urn:nbn:de:bsz:21-dspace-635717
http://dx.doi.org/10.15496/publikation-4993
Dokumentart: Aufsatz
Date: 2015-06-10
Source: University of Tübingen Working Papers in Economics and Finance ; 80
Language: English
Faculty: 6 Wirtschafts- und Sozialwissenschaftliche Fakultät
Department: Wirtschaftswissenschaften
DDC Classifikation: 330 - Economics
Keywords: Arbeitslosigkeit
Other Keywords: Arbeitslosenunterstützung
Unemployment benefits
Social comparisons
Relative deprivation
License: Publishing license excluding print on demand
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Abstract:

Social comparisons are important in the employment sphere. A “culture of unemployment” may evolve and prevail because it is optimal for an individual to remain unemployed when other unemployed individuals constitute his main reference group. We advance the idea that by making the receipt of unemployment benefits conditional on engagement in an incentive-enhancing activity (for example, work under state-sponsored employment schemes or participation in work-site-based training programs), a government can engineer a revision of the reference groups of an unemployed individual in order to induce him to seek work.

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