Evaluating the effectiveness of Washington state repeated job search services on the employment rate of prime-age female welfare recipients

This paper uses an unbalanced panel dataset to evaluate how repeated job search services (JSS) and personal characteristics affect the employment rate of the prime-age female welfare recipients in the State of Washington. We propose a transition probability model to take into account issues of sample attrition, sample refreshment and duration dependence. We also generalize Honore and Kyriazidou's [Honore, B.E., Kyriazidou, E., 2000. Panel data discrete choice models with lagged dependent variables. Econometrica 68 (4), 839-874] conditional maximum likelihood estimator to allow for the presence of individual-specific effects. A limited information test is suggested to test for selection issues in nonexperimental data. The specification tests indicate that the (conditional on the set of the confounding variables considered) assumptions of no selection due to unobservables and/or no unobserved individual-specific effects are not violated. Our findings indicate that the first job search service does have positive and significant impacts on the employment rate. However, providing repeated JSS to the same client has no significant impact. Further, we find that there are significant experience-enhancing effects. These findings suggest that providing one job search services training to individuals may have a lasting impact on raising their employment rates. (C) 2008 Elsevier B.V. All rights reserved.