The dilemma of delegating search: Budgeting in public employment services

Arbeitspapier

The poor performance often attributed to many public employment services may be explained in part by a delegation problem between the central office and local job centers. In markets characterized by frictions, job centers function as match-makers, linking job seekers with relevant vacancies. Because their search intensity in contacting employers and collecting data is not verifiable by the central authority, a typical moral hazard problem can arise. To overcome the delegation problem and provide high-powered incentives for high levels of search effort on the part of job centers, we propose output-related schemes that assign greater staff capacity to agencies achieving high strike rates.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 5170

Classification and Topics

• Classification: Wirtschaft ; Unemployment: Models, Duration, Incidence, and Job Search ; Asymmetric and Private Information; Mechanism Design
• Subject: matching unemployment ; public employment service ; delegation problem ; moral hazard ; search theory ; Arbeitsvermittlung ; Arbeitsverwaltung ; Moral Hazard ; Arbeitsuche ; Kooperative Führung ; Betriebliche Budgetierung ; Ökonomischer Anreiz ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Addison, John T. ; Altemeyer-Bartscher, Martin ; Kuhn, Thomas
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/46079
• Last update: 10.03.2025, 11:44 AM CET