Leaving Poverty Behind? The Effects of Generous Income Support Paired with Activation

Leaving Poverty Behind? The Effects of Generous Income Support Paired with Activation We evaluate a comprehensive activation program in Norway targeted at hard-to-employ social assistance claimants with reduced work capacity. The program offers a combination of tailored rehabilitation, training and job practice, and a generous, stable, and non-meanstested benefit. Its main aims are to mitigate poverty and subsequently promote selfsupporting employment. Our evaluation strategy exploits a geographically staggered program introduction, and the causal effects are identified on the basis of changes in employment prospects that coincide with local program implementation in a way that correlates with the predicted probability of becoming a participant. We find that the program raised employment prospects considerably. JEL Classification: C21, C26, H55, I30, J24