published in: Journal of the European Economic Association, 2005, 3 (6), 1386-1417
This paper investigates the effectiveness of benefit sanctions in reducing unemployment
duration. Data from the Swiss labor market allow making a distinction between the effect of a
warning that a person is not complying with eligibility requirements and the effect of the
actual enforcement of a benefit sanction. We find that both warning and enforcement have a
positive effect on the exit rate out of unemployment. Moreover, the stricter the sanction policy
the shorter is the duration of unemployment of the non-sanctioned. This can be taken as
evidence of a strong ex-ante effect of a strict sanction policy.
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