I have not yet seen much research contrasting the outcomes of such policies with alternative uses of public money, such as a reduction in the tax wedge on labour. • Do we know enough about what drives the efficiency of the matching process between job-seekers and vacancies? Do we understand the reasons for persistent geographical and skill misalignments?
What is the key to designing policies to target structural, longterm unemployment? • Finally, many are puzzled by how little wage cyclicality is normally observed, especially at the aggregate level. Can this be due to composition effects, i.e., to the fact that negative demand shocks usually hit low-skilled or low-tenured workers hardest? What is the impact of nominal wage rigidities, and of job-seekers’ behaviour?