University of Copenhagen | Assistant Professor | Department of Economics

Research

Research Interests

Labor Economics, Public Economics, Behavioral Economics, Financial Economics, Applied Econometrics 

Working Papers and Work in Progress

The Intended and Unintended Effects of Promoting Labor Market Mobility (with M. Caliendo & S. Künn; IZA Discussion Paper No. 15011, R&R at Review of Economics and Statistics)

Subsidizing the geographical mobility of unemployed workers may improve welfare by relaxing their financial constraints and allowing them to find jobs in more prosperous regions. We exploit regional variation in the promotion of mobility programs along administrative borders of German employment agency districts to investigate the causal effect of offering such financial incentives on the job search behavior and labor market integration of unemployed workers. We show that promoting mobility - as intended - causes job seekers to increase their search radius, apply for and accept distant jobs. At the same time, local job search is reduced with adverse consequences for reemployment and earnings. These unintended negative effects are provoked by spatial search frictions. Overall, the unconditional provision of mobility programs harms the welfare of unemployed job seekers.

How Does Personalized Information Affect the Transition from Welfare to Work? A Field Experiment on Work Requirements and Sanctions (with S. Cairo, R&R at Journal of Public Economics)

We study how the provision of personalized information affects individuals' transition from welfare to work. Our large-scale field experiment relies on a newly developed online tool to inform benefit recipients in Denmark - who face a minimum work requirement - about their personal risk of a benefit sanction. Treated individuals with access to fully personalized and dynamic information are more likely to start a regular full-time job and work less often in marginal jobs while being on welfare claim. This increases their overall working hours and labor earnings. The positive labor market effects are driven by individuals with a low personal sanction risk, who may feel less pressured to search for and accept lower-quality jobs when they have access to personalized information. Hence, personalized digital tools can effectively reduce information constraints and improve individual decision making to the benefit of labor market reintegration.

Risk Sharing Within and Outside the Firm: The Disparate Effects of Wrongful Discharge Laws on Expected Stock Returns (with R. Weber; IZA Discussion Paper No. 13941)

We study the effect of wrongful-discharge laws (WDL) on firm-level stock returns. We find disparate effects depending on the exact design of the law. Consistent with rational, risk-based pricing, the effect on returns seems to be linked to how firms share systematic risk with their employees under the respective laws. Firms in states with WDLs prohibiting employers from acting in bad faith have more intra-firm risk sharing and lower expected returns. Vaguer legislation that prohibits discharges in retaliation for acting in accordance with public policy is associated with less intra-firm risk sharing and higher expected returns.

Do Job Seekers Understand the UI Benefit System (and Does It Matter)? (with S. Altmann, S. Cairo and A. Sebald)

We study how job seekers' understanding of complex unemployment benefit rules affects their labor market performance. Combining data from a large-scale scale field experiment, detailed administrative records, and a survey of unemployed job seekers, we document three main results. First, job seekers exhibit pronounced knowledge gaps about the prevailing unemployment benefit rules and their personal benefit entitlements. Second, we show that a low-cost information strategy using a personalized online tool increases job seekers' understanding of the rules and their personal situation. Finally, we document heterogeneous labor-market effects of the intervention depending on the benefit recipients' baseline knowledge, their general employment prospects and the timing of the intervention during the benefit spell.

The Direct and Indirect Effects of Online Job Search Advice (with S. Altmann, A. Glenny and A. Sebald)

We study how online job search advice about the labor demand in various occupations affects the job search behavior and labor market outcomes of unemployed workers. In a large-scale field experiment, we provide occupational recommendations and vacancy information through a new online dashboard. A clustered randomization procedure with varying treatment intensities across different regions allows us to account for treatment spillovers. Our results show that search advice is highly effective when the share of treated is low as it increases working hours and earnings by 11-15%. At the same time, we find substantial negative spillovers on other treated job seekers for higher treatment intensities, which are provoked by crowding out among job seekers applying for the same vacancies.