JOB DURATION AND THE MACRO-EVALUATION OF EMPLOYMENT POLICY - THE EXAMPLE OF UK REGIONAL POLICY

The paper argues that in order to use macro-evaluation techniques to c alculate the employment effect of a policy over some sub-period after policy commencement, it is necessary to determine the rate at which po licy jobs are lost. Crucially, it is the rate at which jobs cease to b e attributable to policy which is relevant, rather than the rate at wh ich jobs are lost to firms. This point is demonstrated for the case of UK regional policy over the period 1971-81. It is shown that the meas ured employment effect of this policy is highly sensitive to assumptio ns about the rate of policy jobs loss, but insensitive to the period o ver which jobs exist prior to being lost. Under reasonable assumptions , it is argued that the employment effect of this policy over the 1970 s was twice that previously thought.