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To what extent, hiring incentives targeting a specific group of vulnerableunemployed (i.e. long term unemployed) are more effective, with respect togeneralised incentives (without a definite target), to increase hirings of thetargeted group? Are generalized incentives able to influence hirings of thevulnerable group? Do targeted policies have negative side effects too importantto accept them? Even though there is a huge literature on hiring subsidies,these questions remained unresolved. We tried to answer them, comparing theimpact of two similar hiring policies, one oriented towards a target group andone generalised, implemented on the italian labour market. We usedadministrative data on job contracts, and counterfactual analysis methods. Thetargeted policy had a positive and significant impact, while the generalizedpolicy didn't have a significant impact on the vulnerable group. Moreover, weconcluded the targeted policy didn't have any indirect negative side effect.

Long-Term Unemployed hirings: Should targeted or untargeted policies be preferred?