Volume 30, Number 3 (Summer) 1995
Decker, Paul T., and Christopher J. O'Leary. 1995. "Evaluating Pooled Evidence from the Reemployment Bonus Experiments." Journal of Human Resources 30(3):534-550.
Social experiments conducted in Pennsylvania and Washington tested the effect of offering Unemployment Insurance (UI) claimants a cash bonus for rapid reemployment. This paper combines data from the two experiments and uses a consistent framework to evaluate the experiments and determine with greater certainty the extent to which a reemployment bonus can affect economic outcomes. Bonus offers in each of the experiments generated statistically significant but relatively modest reductions in UI receipt. Since the estimated impacts on UI receipt were modest, the reemployment bonuses did not generate the UI savings necessary to pay for administering and paying the bonuses. Hence, contrary to earlier findings from a bonus experiment conducted in Illinois, findings from the Pennsylvania and Washington experiments strongly suggest that a reemployment bonus is not a cost-effective method of speeding the reemployment of UI claimants.
Paul T. Decker is a senior economist at Mathematica Policy Research; Christopher J. O'Leary is a senior economist at the W.E. Upjohn Institute for Employment Research. The authors thank Walter Corson, Bob Spiegelman, Stuart Kerachsky, Stephen Woodbury, Wayne Zajac, Kevin Hollenbeck, and an anonymous referee for comments on earlier versions of this paper. Lauren Beaumont and ken Kline provided excellent research assistance. Funding for this work was provided by the U.S. Department of Labor under contract 99-7-0805-04-137-01 and by the W.E. Upjohn Institute for Employment Research. The data used in this article can be obtained beginning December 1995 through December 1998 from Paul T. Decker: Mathematica Policy Research, 600 Maryland Avenue, SW, Suite 550, Washington, DC 20024.
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