In the last three decades, active labor market policies have gained a higher share of the total spending on labor policies and have received increased attention as governments seek to insure unemployed workers without damaging their incentives for becoming employed. Given that additional policy instruments such as jobsearch monitoring are available and are implemented by governments, it is important to model these instruments, to examine the extent to which these instruments increase the efficiency of unemployment insurance programs, and to compare existing policies to the optimal policy
