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Deregulating Job Placement in Europe: A Microeconometric Evaluation of an Innovative Voucher Scheme in Germany

  • Winterhager, Henrik

    ()

    (ZEW Mannheim)

  • Heinze, Anja

    ()

    (ZEW Mannheim)

  • Spermann, Alexander

    ()

    (IZA)

Job placement vouchers can be regarded as a tool to spur competition between public and private job placement activities. The German government launched this instrument in order to end the public placement monopoly and to subsidize its private competitors. We exploit very rich administrative data provided for the first time by the Federal Employment Agency and apply propensity score matching as a method to solve the fundamental evaluation problem and to estimate the effect of the vouchers. We find positive treatment effects on the employment probability after one year of 6.5 percentage points in Western Germany and give a measure for deadweight loss.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2109.

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Length: 22 pages
Date of creation: Apr 2006
Date of revision:
Publication status: published in: Labour Economics, 2006, 13 (4), 505-517
Handle: RePEc:iza:izadps:dp2109
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  1. Richard Blundell & Monica Costa Dias, 2009. "Alternative Approaches to Evaluation in Empirical Microeconomics," Journal of Human Resources, University of Wisconsin Press, vol. 44(3).
  2. Hagemann, Sabine & Sörgel, Werner, 2005. "Vermittlungsgutscheine: Zwischenergebnisse der Begleitforschung 2004 : Teil 6: Implementations- und Strukturanalysen - Private Arbeitsvermittler," IAB-Forschungsbericht 200506, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  3. A. Smith, Jeffrey & E. Todd, Petra, 2005. "Does matching overcome LaLonde's critique of nonexperimental estimators?," Journal of Econometrics, Elsevier, vol. 125(1-2), pages 305-353.
  4. James J. Heckman & Jeffrey Smith, 2003. "The Determinants of Participation in a Social Program: Evidence from a Prototypical Job Training Program," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers 20034, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
  5. James Heckman & Hidehiko Ichimura & Jeffrey Smith & Petra Todd, 1998. "Characterizing Selection Bias Using Experimental Data," Econometrica, Econometric Society, vol. 66(5), pages 1017-1098, September.
  6. Rajeev H. Dehejia & Sadek Wahba, 2002. "Propensity score matching methods for non-experimental causal studies," Discussion Papers 0102-14, Columbia University, Department of Economics.
  7. Joshua Angrist & Alan Krueger, 1998. "Empirical Strategies in Labor Economics," Working Papers 780, Princeton University, Department of Economics, Industrial Relations Section..
  8. Barbara Sianesi, 2004. "An Evaluation of the Swedish System of Active Labor Market Programs in the 1990s," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 133-155, February.
  9. Michael Gerfin & Michael Lechner, 2002. "A Microeconometric Evaluation of the Active Labour Market Policy in Switzerland," Economic Journal, Royal Economic Society, vol. 112(482), pages 854-893, October.
  10. Michalopoulos, Charles & Robins, Philip K. & Card, David, 2005. "When financial work incentives pay for themselves: evidence from a randomized social experiment for welfare recipients," Journal of Public Economics, Elsevier, vol. 89(1), pages 5-29, January.
  11. Dorsett, Richard, 2006. "The new deal for young people: effect on the labour market status of young men," Labour Economics, Elsevier, vol. 13(3), pages 405-422, June.
  12. Michael Lechner, 2002. "Some practical issues in the evaluation of heterogeneous labour market programmes by matching methods," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 165(1), pages 59-82.
  13. Alfred M. DOCKERY & Thorsten STROMBACK, 2001. "Devolving public employment services: Preliminary assessment of the Australian experiment," International Labour Review, International Labour Organization, vol. 140(4), pages 429-451, December.
  14. Lechner, Michael, 1999. "Earnings and Employment Effects of Continuous Off-the-Job Training in East Germany after Unification," Journal of Business & Economic Statistics, American Statistical Association, vol. 17(1), pages 74-90, January.
  15. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier.
  16. Ludo Struyven & Geert Steurs, 2003. "The Competitive Market for Employment Services in the Netherlands," OECD Social, Employment and Migration Working Papers 13, OECD Publishing.
  17. Lechner, Michael, 1999. "Identification and Estimation of Causal Effects of Multiple Treatments Under the Conditional Independence Assumption," IZA Discussion Papers 91, Institute for the Study of Labor (IZA).
  18. Heckman, James J & Ichimura, Hidehiko & Todd, Petra E, 1997. "Matching as an Econometric Evaluation Estimator: Evidence from Evaluating a Job Training Programme," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 605-54, October.
  19. Lechner, Michael & Pfeiffer, Friedhelm & Spengler, Hannes & Almus, Matthias, 2000. "The impact of non-profit temping agencies on individual labour market success in the West German state of Rhineland-Palatinate," ZEW Discussion Papers 00-02, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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