A typology of activation incentives

Activation has received an enormous amount of attention over the past decade and a half. Despite the immense academic interest, activation policies remain difficult to compare. This is notably because these policies can be adapted multiple ways and are not confined to one policy area. Furthermore, common activation indicators such as expenditures can be misleading as not all activation instruments affect spending levels. These limitations notwithstanding, states continue to create and adapt activation policies. With the objective of identifying and comparing second‐order change, the author proposes a typology of activation policies according to how they affect target population behavior through incentives. The typology first identifies the lever to the labor market, supply, or demand. Second, it determines whether the mechanism for labor market integration is financial or human capital. In so doing, it allows for a more detailed understanding of the policy instruments adopted. This can be used as a tool in qualitative analysis to identify a change in policy instruments within and between cases.