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Oekonometrie vs. Projektdesign: Lehren aus der Evaluation eines Modellprojekts zur Umsetzung des Workfare-Konzepts

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Author Info

  • Hilmar Schneider

    ()
    (IZA Bonn)

  • Arne Uhlendorff

    ()
    (Universität Mannheim)

  • Klaus F. Zimmermann

    ()
    (IZA Bonn)

Abstract

A common problem of welfare states consists of a high unemployment risk for low-skilled workers. This is often attributed to a lack of jobs for the low-skilled, but it may as well be caused by a lack of incentives to work. Low-skilled workers are easily substitutable and therefore have little bargaining power. Hence, they are typically dependent on low-paid jobs. This may create disincentives towork, if the achievable marketwage does not sufficiently exceed the welfare level. Workfare could be an efficient strategy to overcome such disincentives by introducing a work requirement for unemployed welfare recipients. In our paper we investigate the importance of such a supply side policy. We evaluate a pilot workfare project of a Berlin city community to integrate young people in social assistance into the labor market. Reference data are generated in collaboration with the German Employment Office. The participation effect is found to be positive and of relevant size, but not statistically significant. This indicates that selection biases detected in the allocation process of individuals to the program can be adjusted by econometric techniques, but only at the prize of reduced significance levels. Given the small sample sizes of pilot projects this calls for social experiments in controlled project designs.

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Bibliographic Info

Article provided by Justus-Liebig University Giessen, Department of Statistics and Economics in its journal Journal of Economics and Statistics.

Volume (Year): 233 (2013)
Issue (Month): 1 (January)
Pages: 65-85

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Handle: RePEc:jns:jbstat:v:233:y:2013:i:1:p:65-85

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Keywords: Workfare; labor supply; evaluation; social experiments;

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References

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  1. Guido M. Imbens & Jeffrey M. Wooldridge, 2008. "Recent Developments in the Econometrics of Program Evaluation," NBER Working Papers 14251, National Bureau of Economic Research, Inc.
  2. Martin Huber & Michael Lechner & Conny Wunsch & Thomas Walter, 2009. "Do German Welfare-to-Work Programmes Reduce Welfare and Increase Work?," University of St. Gallen Department of Economics working paper series 2009 2009-03, Department of Economics, University of St. Gallen.
  3. Hilmar Schneider, 2008. "Die Veränderung der Lohnersatzleistungen und die Reform der Vermittlungsprozesse im SGB III," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 77(1), pages 20-37.
  4. John A. List, 2011. "Why Economists Should Conduct Field Experiments and 14 Tips for Pulling One Off," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 3-16, Summer.
  5. Richard Blundell & Monica Costa Dias, 2009. "Alternative Approaches to Evaluation in Empirical Microeconomics," Journal of Human Resources, University of Wisconsin Press, vol. 44(3).
  6. Orley Ashenfelter, 1986. "The Case for Evaluating Training Programs with Randomized Trials," Working Papers 583, Princeton University, Department of Economics, Industrial Relations Section..
  7. Holger Bonin & Armin Falk & Hilmar Schneider, 2007. "Workfare – praktikabel und gerecht," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, vol. 60(04), pages 33-37, 02.
  8. Chiburis, Richard C. & Das, Jishnu & Lokshin, Michael, 2012. "A practical comparison of the bivariate probit and linear IV estimators," Economics Letters, Elsevier, vol. 117(3), pages 762-766.
  9. Schneider, Hilmar & Uhlendorff, Arne & Zimmermann, Klaus F., 2010. "Mit Workfare aus der Sozialhilfe? Lehren aus einem Modellprojekt," IZA Standpunkte 33, Institute for the Study of Labor (IZA).
  10. Caliendo, Marco & Kopeinig, Sabine, 2005. "Some Practical Guidance for the Implementation of Propensity Score Matching," IZA Discussion Papers 1588, Institute for the Study of Labor (IZA).
  11. Hilmar Schneider & Arne Uhlendorff, 2005. "Transitions from Welfare to Employment: Does the Ratio between Labor Income and Social Assistance Matter?," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 125(1), pages 51-61.
  12. Louis N. Christofides, 2000. "Social assistance and labour supply," Canadian Journal of Economics, Canadian Economics Association, vol. 33(3), pages 715-741, August.
  13. Peter Jacobebbinghaus & Stefan Seth, 2007. "European Data Watch: The German Integrated Employment Biographies Sample IEBS," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 127(2), pages 335-342.
  14. James J. Heckman & Jeffrey A. Smith, 1995. "Assessing the Case for Social Experiments," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 85-110, Spring.
  15. Bonin, Holger & Kempe, Wolfram & Schneider, Hilmar, 2002. "Kombilohn oder Workfare? Zur Wirksamkeit zweier arbeitsmarktpolitischer Strategien," IZA Discussion Papers 587, Institute for the Study of Labor (IZA).
  16. repec:feb:artefa:0110 is not listed on IDEAS
  17. Marco Caliendo & Viktor Steiner, 2005. "Aktive Arbeitsmarktpolitik in Deutschland: Bestandsaufnahme und Bewertung der mikroökonomischen Evaluationsergebnisse," Discussion Papers of DIW Berlin 515, DIW Berlin, German Institute for Economic Research.
  18. Chiara Monfardini & Rosalba Radice, 2008. "Testing Exogeneity in the Bivariate Probit Model: A Monte Carlo Study," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 70(2), pages 271-282, 04.
  19. Schneider, Hilmar & Zimmermann, Klaus F. & Bonin, Holger & Brenke, Karl & Haisken-DeNew, John P. & Kempe, Wolfram, 2002. "Report No. 5: Beschäftigungspotenziale einer dualen Förderstrategie im Niedriglohnbereich," IZA Research Reports 5, Institute for the Study of Labor (IZA).
  20. Martin, John P. & Grubb, David, 2001. "What works and for whom: a review of OECD countries' experiences with active labour market policies," Working Paper Series 2001:14, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  21. Rebecca M. Blank, 2002. "Evaluating Welfare Reform in the United States," NBER Working Papers 8983, National Bureau of Economic Research, Inc.
  22. Card, David & Ibarrarán, Pablo & Villa, Juan Miguel, 2011. "Building in an Evaluation Component for Active Labor Market Programs: A Practitioner's Guide," IZA Discussion Papers 6085, Institute for the Study of Labor (IZA).
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Cited by:
  1. Arni, Patrick, 2012. "Kausale Evaluation von Pilotprojekten: Die Nutzung von Randomisierung in der Praxis," IZA Standpunkte 52, Institute for the Study of Labor (IZA).

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