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Side effects of labor market policies*

Side effects of labor market policies* Labor market policies, such as training and sanctions, are commonly used to bring workers back to work. By analogy to medical treatments, exposure to these tools can have side effects. We study the effects on health using individual‐level population registers on labor market outcomes, drug prescriptions, and sickness absence, comparing outcomes before and after exposure to training and sanctions. Training improves cardiovascular and mental health, and lowers sickness absence. This is likely to be the result of the instantaneous features of participation, such as the adoption of a more rigorous daily routine, rather than improved employment prospects. Benefits sanctions cause a short‐run deterioration of mental health. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The Scandinavian Journal of Economics Wiley

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References (68)

Publisher
Wiley
Copyright
© 2023 The editors of The Scandinavian Journal of Economics.
ISSN
0347-0520
eISSN
1467-9442
DOI
10.1111/sjoe.12514
Publisher site
See Article on Publisher Site

Abstract

Labor market policies, such as training and sanctions, are commonly used to bring workers back to work. By analogy to medical treatments, exposure to these tools can have side effects. We study the effects on health using individual‐level population registers on labor market outcomes, drug prescriptions, and sickness absence, comparing outcomes before and after exposure to training and sanctions. Training improves cardiovascular and mental health, and lowers sickness absence. This is likely to be the result of the instantaneous features of participation, such as the adoption of a more rigorous daily routine, rather than improved employment prospects. Benefits sanctions cause a short‐run deterioration of mental health.

Journal

The Scandinavian Journal of EconomicsWiley

Published: Apr 1, 2023

Keywords: Cardiovascular disease; depression; drugs; health; mental health; prescriptions; sanctions; sickness; training; unemployment

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