Displaced workers: causes, characteristics, and policy options
This project revolves around displaced workers. It has three parts. In the first part we characterize the selection into displacement: Who gets laid off and why? We revisit the classic questions of wage rigidity and selection into unemployed in previously unexplored ways. The second part of the project investigates the effects of mandated advance lay-off notice, a policy that exists in almost all OECD countries. Despite its wide-spread use, no previous study has credibly estimated the effects of this policy. We ask two main questions: What s the value of the insurance provided by advance notice for workers? What s the size of the costs imposed on firms? The third part of the project estimates the long-run impact of Public Employment Service (PES) caseworkers for the subsequent labor market outcomes of the unemployed. It also examines whether caseworkers are more important for some unemployed individuals. The analysis addresses the following policy question: Is it possible to improve the employment prospects by reallocating unemployed jobseekers onto caseworkers? The project combines up-to-date empirical approaches and the exceptional quality of Swedish administrative data to estimate relationships that are also relevant from a normative point of view.