Type
Article
Titre
The Effectiveness of Hiring Credits
Dans
The review of economic studies
Auteur(s)
CAHUC Pierre - Département d'économie (Auteur)
CARCILLO Stéphane - Département d'économie (Auteur)
LE BARBANCHON Thomas - Centre de Recherche en Économie et Statistique (GENES) (Auteur)
Éditeur
GB : Oxford University Press
Volume
86
Numéro
2
Pages
593 - 626 p.
ISSN
1467937X
DOI
10.1093/restud/rdy011
Mots clés
Hiring credit, Labor demand, Search and matching model
Résumé
EN
This paper analyzes the effectiveness of hiring credits. Using comprehensive administrative data, we show that the French hiring credit, implemented during the Great Recession, had significant positive employment effects and no effects on wages. Relying on the quasi-experimental variation in labor cost triggered by the hiring credit, we estimate a structural search and matching model. Simulations of counterfactual policies show that the effectiveness of the hiring credit relied to a large extent on three features: it was nonanticipated, temporary and targeted at jobs with rigid wages. We estimate that the cost per job created by permanent hiring credits, either countercyclical or time-invariant, in an environment with flexible wages would have been much higher.

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