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Are Training Programs More Effective When Unemployment Is High?

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Author Info

  • Lechner, Michael

    ()
    (University of St. Gallen)

  • Wunsch, Conny

    ()
    (University of Basel)

Abstract

We estimate short, medium, and long-run individual labor market effects of training programs for unemployed by following program participation on a monthly basis over a ten-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 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.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2355.

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Length: 46 pages
Date of creation: Oct 2006
Date of revision:
Publication status: published in: Journal of Labor Economics, 2009, 27 (4), 653-692
Handle: RePEc:iza:izadps:dp2355

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Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
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Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
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Related research

Keywords: panel data; program evaluation; long-run effects; matching estimation; active labor market policy; causal effects;

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References

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  1. Fröhlich, Markus & Lechner, Michael, 2006. "Exploiting Regional Treatment Intensity for the Evaluation of Labour Market Policies," CEPR Discussion Papers 5728, C.E.P.R. Discussion Papers.
  2. Rajeev H. Dehejia & Sadek Wahba, 1998. "Propensity Score Matching Methods for Non-experimental Causal Studies," NBER Working Papers 6829, National Bureau of Economic Research, Inc.
  3. Jochen Kluve & Christoph M. Schmidt, 2002. "Can training and employment subsidies combat European unemployment?," Economic Policy, CEPR & CES & MSH, vol. 17(35), pages 409-448, October.
  4. Gerfin, Michael & Lechner, Michael, 2000. "Microeconometric Evaluation of the Active Labour Market Policy in Switzerland," IZA Discussion Papers 154, Institute for the Study of Labor (IZA).
  5. Couch, Kenneth A, 1992. "New Evidence on the Long-Term Effects of Employment Training Programs," Journal of Labor Economics, University of Chicago Press, vol. 10(4), pages 380-88, October.
  6. Michael Lechner & Ruth Miquel & Conny Wunsch, 2011. "Long‐Run Effects Of Public Sector Sponsored Training In West Germany," Journal of the European Economic Association, European Economic Association, vol. 9(4), pages 742-784, 08.
  7. Jacobson, Louis & LaLonde, Robert J. & Sullivan, Daniel G., 2004. "Estimating the Returns to Community College Schooling for Displaced Workers," IZA Discussion Papers 1017, Institute for the Study of Labor (IZA).
  8. Guido W. Imbens, 2004. "Nonparametric Estimation of Average Treatment Effects Under Exogeneity: A Review," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 4-29, February.
  9. Boone, Jan & van Ours, Jan C., 2004. "Effective Active Labor Market Policies," IZA Discussion Papers 1335, Institute for the Study of Labor (IZA).
  10. Fredriksson, Peter & Johansson, Per, 2004. "Dynamic Treatment Assignment – The Consequences for Evaluations Using Observational Data," IZA Discussion Papers 1062, Institute for the Study of Labor (IZA).
  11. V. Joseph Hotz & Guido W. Imbens & Jacob A. Klerman, 2000. "The Long-Term Gains from GAIN: A Re-Analysis of the Impacts of the California GAIN Program," NBER Working Papers 8007, National Bureau of Economic Research, Inc.
  12. Fitzenberger, Bernd & Speckesser, Stefan, 2005. "Employment effects of the provision of specific professional skills and techniques in Germany," IAB Discussion Paper 200521, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  13. Peter Fredriksson & Per Johansson, 2003. "Program Evaluation and Random Program Starts," CESifo Working Paper Series 844, CESifo Group Munich.
  14. Winter-Ebmer, Rudolf, 2001. "Evaluating an Innovative Redundancy-Retraining Project: The Austrian Steel Foundation," IZA Discussion Papers 277, Institute for the Study of Labor (IZA).
  15. Fitzenberger, Bernd & Osikominu, Aderonke & Völter, Robert, 2006. "Get training or wait? : long-run employment effects of training programs for the unemployed in West Germany," IAB Discussion Paper 200617, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  16. Alberto Abadie & Guido W. Imbens, 2006. "Large Sample Properties of Matching Estimators for Average Treatment Effects," Econometrica, Econometric Society, vol. 74(1), pages 235-267, 01.
  17. Robert G. Fay, 1996. "Enhancing the Effectiveness of Active Labour Market Policies: Evidence from Programme Evaluations in OECD Countries," OECD Labour Market and Social Policy Occasional Papers 18, OECD Publishing.
  18. 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.
  19. Jespersen, Svend T. & Munch, Jakob R. & Skipper, Lars, 2008. "Costs and benefits of Danish active labour market programmes," Labour Economics, Elsevier, vol. 15(5), pages 859-884, October.
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