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Active labor market programs - employment gain or fiscal drain?

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  • Alessio Brown
  • Johannes Koettl

Abstract

This paper provides a new perspective by classifying active labor market programs (ALMPs) depending on their objectives, relevance and cost-effectiveness during normal times, a crisis and recovery. We distinguish ALMPs providing incentives for retaining employment, incentives for creating employment, incentives for seeking and keeping a job, incentives for human capital enhancement and improved labor market matching. Reviewing evidence from the literature, we discuss especially indirect effects of various interventions and their cost-effectiveness. The paper concludes by providing a systematic overview of how, why, when and to what extent specific ALMPs are effective. JEL classification: J08, J22, J23, J38, E24 Copyright Brown and Koettl. 2015

Suggested Citation

  • Alessio Brown & Johannes Koettl, 2015. "Active labor market programs - employment gain or fiscal drain?," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-36, December.
  • Handle: RePEc:spr:izalbr:v:4:y:2015:i:1:p:1-36:10.1186/s40172-015-0025-5
    DOI: 10.1186/s40172-015-0025-5
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    14. Pasquini, Alessandra & Centra, Marco & Pellegrini, Guido, 2019. "Fighting long-term unemployment: Do we have the whole picture?," Labour Economics, Elsevier, vol. 61(C).
    15. Blázquez, Maite & Herrarte, Ainhoa & Sáez, Felipe, 2019. "Training and job search assistance programmes in Spain: The case of long-term unemployed," Journal of Policy Modeling, Elsevier, vol. 41(2), pages 316-335.
    16. Rodríguez-Planas, Núria, 2007. "What Works Best for Getting the Unemployed Back to Work: Employment Services or Small-Business Assistance Programmes? Evidence from Romania," IZA Discussion Papers 3051, Institute of Labor Economics (IZA).
    17. Oznur Ozdamar & Eleftherios Giovanis & Cansu Dağlıoğlu & Cemaleddin Gerede, 2021. "The effect of the 2008 employment support programme on young men’s labour market outcomes in Turkey: Evidence from a regression discontinuity design," Manchester School, University of Manchester, vol. 89(3), pages 276-296, June.
    18. repec:ilo:ilowps:487304 is not listed on IDEAS
    19. Michael Lechner & Conny Wunsch, 2009. "Are Training Programs More Effective When Unemployment Is High?," Journal of Labor Economics, University of Chicago Press, vol. 27(4), pages 653-692, October.
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    More about this item

    Keywords

    Active labor market programs; Short work; Subsidies; Training; Workfare; Activation; Sanctions; Job search assistance; Intermediation; Counseling; Cost- effectiveness;
    All these keywords.

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity

    Statistics

    Access and download statistics

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