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The Aggregate Effects of the Hartz Reforms in Germany

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  • Matthias S. Hertweck
  • Oliver Sigrist

Abstract

This paper quantifies the impact of the Hartz reforms on matching efficiency, using monthly SOEP gross worker flows (1983-2009). We show that, until the early 2000s, close to 60% of changes in the unemployment rate are due to changes in the inflow rate (job separation). On the contrary, since the implementation of the reforms in the mid-2000s, the importance of the outflow rate (job finding) has been steadily increasing. This indicates that matching efficiency has improved substantially in recent years. Results from an estimated matching function - pointing to efficiency gains of more than 20% - corroborate this finding.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.414559.de/diw_sp0532.pdf
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Bibliographic Info

Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 532.

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Length: 39 p.
Date of creation: 2013
Date of revision:
Handle: RePEc:diw:diwsop:diw_sp532

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Keywords: SOEP gross worker flows; Hartz reforms; matching efficiency; unemployment fluctuations;

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References

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Citations

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Cited by:
  1. Felbermayr, Gabriel & Impullitti, Giammario & Prat, Julien, 2014. "Firm Dynamics and Residual Inequality in Open Economies," CEPR Discussion Papers, C.E.P.R. Discussion Papers 9855, C.E.P.R. Discussion Papers.
  2. Murat Tasci, 2012. "The ins and outs of unemployment in the long run: unemployment flows and the natural rate," Working Paper, Federal Reserve Bank of Cleveland 1224, Federal Reserve Bank of Cleveland.
  3. Claudia Busl & Atilim Seymen, 2013. "(Spillover) Effects of Labour Market Reforms in Germany and France," WWWforEurope Working Papers series, WWWforEurope 8, WWWforEurope.
  4. Klinger, Sabine & Weber, Enzo, 2012. "Decomposing Beveridge curve dynamics by correlated unobserved components," IAB Discussion Paper, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] 201228, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  5. Launov, Andrey & Wälde, Klaus, 2013. "Thumbscrews for Agencies or for Individuals? How to Reduce Unemployment," IZA Discussion Papers 7659, Institute for the Study of Labor (IZA).
  6. Michael Bräuninger & Jochen Michaelis & Madlen Sode, 2013. "10 Jahre Hartz-Reformen," MAGKS Papers on Economics, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) 201318, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  7. Kloß, Michael & Nagl, Wolfgang, 2013. "Unemployment compensation and unemployment duration - Evidence from the German Hartz IV reform," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order, Verein für Socialpolitik / German Economic Association 79711, Verein für Socialpolitik / German Economic Association.
  8. Bauer, Anja, 2013. "Mismatch unemployment : evidence from Germany 2000-2010," IAB Discussion Paper, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] 201310, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  9. Thomas Beissinger & Nathalie Chusseau & Joel Hellier, 2014. "Offshoring, employment, labour market reform and inequality: Modelling the German experience," Working Papers, ECINEQ, Society for the Study of Economic Inequality 330, ECINEQ, Society for the Study of Economic Inequality.
  10. Poilly, Céline & Wesselbaum, Dennis, 2014. "Evaluating labor market reforms: A normative analysis," Journal of Macroeconomics, Elsevier, Elsevier, vol. 39(PA), pages 156-170.
  11. Catherine SMITH, 2014. "Did the Intergenerational Solidarity Pact increase the employment rate of the elderly in Belgium? A macro-econometric evaluation," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales), Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) 2014009, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  12. Busl, Claudia & Seymen, Atılım, 2013. "The German labour market reforms in a European context: A DSGE analysis," ZEW Discussion Papers, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research 13-097, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.

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