We suggest that instituting unconditional cash grants (UCGs, hereafter) for nationals who choose not to work in the public sector can incentivize employment in the private sector and self-employment/entrepreneurship. Our approach is different from existing policies in the sense that while the aforementioned policies had solely focused on increasing the number of nationals in the private sector without considering self-employment or voluntary unemployment among nationals as a potential option to reduce the size of the public sector, our mechanism would allow for the self-employment to be an alternative career path…

A preprint of this research will be available soon.