Hiring subsidies for people with a disability: Evidence from a small-scale social field experiment

Abstract

The effectiveness of hiring subsidies for people with disabilities remains unclear due to potential free-rider, substitution and signalling effects. The authors propose a novel evaluation approach wherein it is randomly decided whether or not job applications disclose the subsidy to potential employers. Based on call-back rates for interviews, the subsidy is found to be ineffective or even counterproductive in a group of adolescents having completed their vocational training programme. However, the negative signalling effect seems to be much weaker in a group of clients of job-coaching services who acquired their disability during their working life.