Scandinavian Working Papers in Economics

Working Paper Series,
IFAU - Institute for Evaluation of Labour Market and Education Policy

No 2012:2: Does privatisation of vocational rehabilitation improve labour market opportunities? Evidence from a field experiment in Sweden

Lisa Jönsson () and Peter Skogman Thoursie ()
Additional contact information
Lisa Jönsson: Department of Economics, Stockholm University
Peter Skogman Thoursie: IFAU - Institute for Labour Market Policy Evaluation, Postal: P O Box 513, SE-751 20 Uppsala, Sweden

Abstract: This paper analyses if privatisation of vocational rehabilitation can improve labour market opportunities for individuals on long-term sickness absence. We use a field experiment performed by the Employment Service and the Social Insurance Agency in Sweden during 2008 to 2010, in which over 4,000 participants were randomly offered private and public rehabilitation. We find no differences in employment rates following rehabilitation between individuals who received rehabilitation by private and public providers. Also the average cost of rehabilitation was essentially equal for the two types of providers. This suggests that there are no large efficiency gains from privatising vocational rehabilitation.

Keywords: Vocational rehabilitation; Privatisation; Field experiment

JEL-codes: J14; J68; L33

31 pages, January 25, 2012

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