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Three Approaches to the Evaluation of Active Labour Market Policy in East Germany Using Regional Data

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Author Info
Hagen, Tobias
Abstract

Using different regional data sources for East Germany the three largest active labour market policy (ALMP) programmes ? job creation schemes (JCS), structural adjustment schemes (SAS) and public training (PT) ? are evaluated. After addressing the regional allocation rule of the funding of ALMPs and the fundamental simultaneity problem in macroeconomic evaluation studies, identification strategies and possible instrumental variables are discussed. Three different approaches based on different econometric techniques for panel data (GMM and two-stage least squares) are applied. An augmented matching function indicates a negative effect of JCS on regional matching efficiency (inflows into regular employment) and no significant effects of PT and SAS. A reduced form approach based on the Beveridge curve does not indicate any long-term effects of ALMPs on regional job seeker rates. A dynamic labour demand estimation indicates that PT has no effects on employment and JCS leads to displacement of regular employment. --

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Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 03-27.

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Date of creation: 2003
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Handle: RePEc:zbw:zewdip:1021

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Related research
Keywords: Evaluation; Active Labour Market Policy; Identification; Regional Data; Matching Efficiency; Crowding-out;

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Find related papers by JEL classification:
H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
J68 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Public Policy
C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data

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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. David C. Maré, 2005. "Indirect Effects of Active Labour Market Policies," Working Papers 05_01, Motu Economic and Public Policy Research. [Downloadable!]
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