TY - JOUR

T1 - How do the employment effects of job creation schemes differ with respect to the foregoing unemployment duration?

AU - Hujer, Reinhard

AU - Thomsen, Stephan L.

N1 - Funding information: Stephan L. Thomsen thanks the Stifterverband für die Deutsche Wissenschaft (Claussen-Simon-Stiftung) for financial support. We thank two anonymous referees, Moshe Buchinsky, Bernd Fitzenberger, Whang-Sheng Lee, Jeff Smith, Michael Lechner, Henrik Winterhager, Marie Waller, Christopher Zeiss and the participants of the seminars at IZA, Bonn, ZEW, Mannheim, University of Frankfurt and University of Magdeburg for valuable comments. The paper has benefited from discussions at the Pentecost meeting of German Statistical Society, Hamburg, the conferences of the European Economic Association, Vienna, of the European Association of Labour Economists, Prague, of the German Statistical Association, Dresden, of the Verein für Socialpolitik, Bayreuth, and the 3rd Evaluation Conference of ZEW, Mannheim. We thank Steffen Kaimer and Melanie Stamm for help in the preparation of the data. Financial support of the Institute for Employment Research (IAB) within the project `Effects of Job Creation and Structural Adjustment Schemes' is gratefully acknowledged. All remaining errors are our own.

PY - 2009/7/15

Y1 - 2009/7/15

N2 - Based on new administrative data for Germany covering entrances into job creation schemes between July 2000 and May 2001, we evaluate the effects of this active labour market policy programme considering the timing of treatment in the individual unemployment spell. Applying propensity score matching in a dynamic setting where the time until treatment in the unemployment spell is stratified into quarters, regional (East and West Germany) as well as gender differences are considered in the estimation. The results in terms of employment present a heterogeneous, but disappointing picture. For West Germany, most of the estimates are insignificant at the end of the observation period, and only one positive exception could be established. In East Germany, none of the groups experiences an improvement of the labour market situation, but the employment chances tend to be reduced due to participation even 30 months after start of programmes.

AB - Based on new administrative data for Germany covering entrances into job creation schemes between July 2000 and May 2001, we evaluate the effects of this active labour market policy programme considering the timing of treatment in the individual unemployment spell. Applying propensity score matching in a dynamic setting where the time until treatment in the unemployment spell is stratified into quarters, regional (East and West Germany) as well as gender differences are considered in the estimation. The results in terms of employment present a heterogeneous, but disappointing picture. For West Germany, most of the estimates are insignificant at the end of the observation period, and only one positive exception could be established. In East Germany, none of the groups experiences an improvement of the labour market situation, but the employment chances tend to be reduced due to participation even 30 months after start of programmes.

KW - Active labour market policy

KW - Administrative data

KW - Evaluation

KW - Hidden bias

KW - Job creation schemes

KW - Propensity score matching

UR - http://www.scopus.com/inward/record.url?scp=73649128324&partnerID=8YFLogxK

U2 - 10.1016/j.labeco.2009.07.001

DO - 10.1016/j.labeco.2009.07.001

M3 - Article

AN - SCOPUS:73649128324

VL - 17

SP - 38

EP - 51

JO - Labour economics

JF - Labour economics

SN - 0927-5371

IS - 1

ER -