Active Labor Market Policies and instability of their allocations: A changing relationship in the case of regions of Tunisia

Abstract

Evaluation studies focus exclusively on the impact of Active Labor Market Policies (ALMP) on the functioning of the labor market. In particular, they measure the impact of specific programs on the income and future of target groups. Studies that aim to assess the impact of ALMPs as a whole on the overall performance of the labor market remain quite rare. Evaluation studies do not focus on the design and implementation of ALMPs. Little is known about the factors behind the failure or success of ALMPs. This paper addresses this problem by examining how a factor relating to the instability of ALMP and their associated budgetary allocations leads to ineffective ALMPs in a regional context. Based on dynamic panel regression models for a sample of 24 governorates in Tunisia grouped into 7 regions. over the period from 2005 to 2015, we found that ALMPs are effective in reducing the unemployment rate. In addition, by testing the moderating effect of the instability of ALMPs, we show that this instability is very harmful insofar as the link between ALMPs and the unemployment rate is attenuated.