We reconsider the evidence of Lechner, Miquel and Wunsch (2004, 2005) on the effectiveness of training programmes for the unemployed conducted in East and West Germany in the period 1993-1994 by investigating whether, and if so, how overall policy conclusions depend on the particular choice of the outcome variable. We find that different measures of employment and earnings provide very similar results. In contrast, considering unemployment as an outcome measure shows rather different results as the positive long-run effects on employment are not mirrored by a corresponding decrease in unemployment. We show furthermore that it is important to consider the cumulated (net) effects of the programmes for an assessment of the overall effectiveness of different training programmes because they can yield conclusions which are different from those of the point-in-time estimates.
We estimate short-run, medium-run, and long-run individual labor market effects of training programs for the unemployed by following program participation on a monthly basis over a 10-year period. Since analyzing the effectiveness of training over such a long period is impossible with experimental data, we use an administrative database compiled for evaluating German training programs. Based on matching estimation adapted to address the various issues that arise in this particular context, we find a clear positive relation between the effectiveness of the programs and the unemployment rate over time. (doi:10.1086/644976)
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We investigate the effects of the most important East German active labour market programmes on the labour market outcomes of their participants. The analysis is based on a large and informative individual database coming from administrative data sources. Using matching methods, we find that over a horizon of 2.5 years after programme start the programmes fail to increase the employment chances of their participants in the regular labour market. However, the programmes may have other effects for their participants that may be considered important in the especially difficult situation experienced in the East German labour market.
This paper develops a life-cycle model of labour supply that captures endogenous human capital
formation allowing for individual's heterogeneous responses to stochastic labour market shocks. The
shocks determines conditions in the labour market and sort individuals into three labour market regimes;
employment, unemployment with and unemployment without participation in labour market programmes.
The structural model entails time independent stochastic shocks that have transitory effects on monetary
returns while the effect on human capital formation may be permanent. The permanent effect may justify
the existence of active labour market programmes if these programmes imply non-depreciating human
capital and human capital depreciation is detected for the non-participant unemployed. Using several
years of the Swiss Labour Force Survey (SAKE, 1991 - 2004) the empirical section compares the
dynamic formation of human capital between labour market regimes. The results are consistent with the
assumptions of the structural model and suggest human capital depreciation for unemployment without
programme participation. They further show that labour programmes may act as a buffer to reduce human
capital loss while unemployed.
If labour market policies aimed at people with disabilities are effective, we should observe no significant difference in labour market outcomes between disabled and non-disabled individuals. This Paper examines the impact of disability status on labour market outcomes using matching methods associated with treatment effect techniques for programme evaluation. Such techniques are fairly robust with respect to model misspecification and account for the common support problem, thus improving the identification and estimation strategy. Using the German Socio-Economic Panel (1984-2001) we estimate the impact of disability on labour market participation and different income measures. We find that those who are not disabled experience higher employment rates and higher earnings relative to those who have become disabled. This difference is almost always significant for all labour market outcomes considered. available online at CEPR or Download Discussion Paper: (pdf, 838 kb)
In this article we analyse the individual effects of becoming disabled on key aspects of labour market outcomes in Germany. The German Socio Economic Panel (1984-2002) collects socio-economic and health data. This data is organized such that the potential problems for such an estimation that may arise from disability not being a random event are considerably reduced. Using matching methods, we find a reduction of individual employment chances of about 9 to 13%, the level depending on the degree of disability. We find no statistically significant evidence for a reduction in income or an increase in unemployment due to disability. We interpret these findings as an indication that the German social security systems appear to successfully mitigate or at least reduce the economic hardship that comes with the event of disability.
We investigate the allocation of unemployed individuals to different subprograms within Swiss active labour market policy by the caseworkers at local employment offices in Switzerland in 1998. We are particularly interested in whether the caseworkers allocate the unemployed to services in ways that will maximize the program-induced changes in their employment probabilities. Our econometric analysis uses unusually informative data originating from administrative unemployment and social security records. For the estimation we apply matching estimators adapted to the case of multiple programmes. The number of observations in this database is sufficiently high to allow for this nonparametric analysis to be conducted in narrowly defined subgroups. Our results indicate that Swiss caseworkers do not do a very good job of allocating their unemployed clients to the subprograms so as to maximize their subsequent employment prospects. Our findings suggest one of three possible conclusions. First, caseworkers may be trying to solve the problem of allocating the unemployed to maximize their subsequent employment, but may lack the skills or knowledge to do this. Second, caseworkers may have a goal other than efficiency, such as allocating the most expensive services to the least well-off clients, that is not explicit in the law regulating active labour market policies. Third, the distortions of the local decision process could be due to federal authorities imposing strict minimum participation requirements for the various programs at the regional level. (doi:10.1016/j.labeco.2004.12.002)
