The relative efficiency of labor market programs: Swedish experience from the 1990s

We estimate the relative efficiency of eight Swedish labor market programs in reducing the unemployment duration for participants, using a rich, administrative data set of all adult unemployed workers. We find that programs in which the participants obtain subsidized work experience and training provided by firms have better outcomes than classroom vocational training. The relative efficiency is similar across demographic and skill groups, and independent of the timing of the placement. A careful examination of the assignment process to programs reveals no self-selection, but substantial administrative selection. It appears to be unrelated to the outcome, however, and should not bias the results. (C) 2003 Elsevier B.V. All rights reserved.