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The Targeted Negative Income Tax (TNIT) in Germany: Evidence from a Quasi Experiment

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  • Spermann, Alexander

    ()
    (IZA)

  • Strotmann, Harald

    ()
    (Institut für Angewandte Wirtschaftsforschung)

Abstract

We report empirical evidence from the first field experiments to be conducted in Germany with program and control groups between 1999 and 2002. The evaluated program called "Targeted Negative Income Tax (TNIT)" is a time-restricted employee subsidy for means-tested welfare recipients. We focus on a unique data set on welfare recipients in Mannheim and estimate the treatment effect of TNIT on participation probability. The average treatment effect is significant and lies between 6.6 and 6.8 percentage points. Since January 1st, 2005, TNIT can be offered to all means-tested long-term unemployed people in Germany by public case managers.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2067.

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Length: 47 pages
Date of creation: Apr 2006
Date of revision:
Handle: RePEc:iza:izadps:dp2067

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Related research

Keywords: field experiments; labor market reform; negative income tax; employee subsidy; long-term unemployment;

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References

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Citations

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Cited by:
  1. Sachverständigenrat zur Begutachtung der Gesamtwirtschaftlichen Entwicklung (ed.), 2006. "Arbeitslosengeld II reformieren: Ein zielgerichtetes Kombilohnmodell. Expertise im Auftrag des Bundesministers für Wirtschaft und Technologie," Occasional Reports / Expertisen, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung, number 75364.
  2. Jirjahn, Uwe & Pfeifer, Christian & Tsertsvadze, Georgi, 2006. "Mikroökonomische Beschäftigungseffekte des Hamburger Modells zur Beschäftigungsförderung," IAB Discussion Paper 200625, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  3. Spermann, Alexander, 2006. "Basic Income Reform in Germany: Better Gradualism than Cold Turkey," ZEW Discussion Papers 06-64, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.

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