Department of Economics and Business Economics

The Effect of Sanctions on the Job Finding Rate: Evidence from Denmark

Research output: Working paperResearch

  • School of Economics and Management
This paper investigates the effect of sanctions of unemployment insurance benefits on
the exit rate from unemployment for a sample of Danish unemployed. According to the findings are
that even moderate sanctions have rather large effects. For both males and females the exit rate
increases by more than 50% following imposition of a sanction. The paper exploits a rather large
sample to elaborate on the basic findings. It is shown that harder sanctions have a larger effect,
that the effect of sanctions wear out after around 3 months and that particular groups of unemployed
are more responsive to sanctions than others. Finally, the analysis suggests that men react ex ante
to the risk of being sanctioned in the sense that men who face higher sanction risk leave
unemployment faster.
Original languageEnglish
Place of publicationAarhus
PublisherInstitut for Økonomi, Aarhus Universitet
Number of pages37
Publication statusPublished - 2007

    Research areas

  • Sanctions, Unemployment hazard

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ID: 7500099