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Do Firms Benefit from Active Labour Market Policies?

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  • Lechner, Michael

    ()

  • Wunsch, Conny

    ()

  • Scioch, Patrycja

Abstract

This paper investigates the link between variation in the supply of workers who participate in specific types of active labour market policies (ALMPs) and firm performance using a new exceptionally informative German employer-employee data base. For identification we exploit that German local employment agencies (LEAs) have a high degree of autonomy in determining their own mix of ALMPs and that firms' hiring regions overlap only imperfectly with the areas of responsibility of the LEAs. Our results indicate that in general firms do not benefit from ALMPs and in some cases may even be harmed by certain programs, in particular by sub¬sidized employment and longer training programs. These findings complement the negative assessment of the cost-effectiveness of ALMPs from the empirical literature on the effects for participants.

Suggested Citation

  • Lechner, Michael & Wunsch, Conny & Scioch, Patrycja, 2013. "Do Firms Benefit from Active Labour Market Policies?," Economics Working Paper Series 1318, University of St. Gallen, School of Economics and Political Science.
    • Handle: RePEc:usg:econwp:2013:18
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    File URL: http://ux-tauri.unisg.ch/RePEc/usg/econwp/EWP-1318.pdf
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    References listed on IDEAS

    as
    1. Bernhard, Sarah & Gartner, Hermann & Stephan, Gesine, 2008. "Wage Subsidies for Needy Job-Seekers and Their Effect on Individual Labour Market Outcomes after the German Reforms," IZA Discussion Papers 3772, Institute for the Study of Labor (IZA).
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    5. 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, August.
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    7. Michael Lechner & Ruth Miquel & Conny Wunsch, 2007. "The Curse and Blessing of Training the Unemployed in a Changing Economy: The Case of East Germany After Unification," German Economic Review, Verein für Socialpolitik, vol. 8, pages 468-509, November.
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    11. Snower, Dennis J, 1994. "Converting Unemployment Benefits into Employment Subsidies," American Economic Review, American Economic Association, vol. 84(2), pages 65-70, May.
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    Cited by:

    1. Blasco, Sylvie & Pertold-Gebicka, Barbara, 2013. "Employment policies, hiring practices and firm performance," Labour Economics, Elsevier, vol. 25(C), pages 12-24.
    2. repec:sav:ebooks:003 is not listed on IDEAS
    3. repec:iab:iabdpa:201821 is not listed on IDEAS

    More about this item

    Keywords

    Subsidized employment programs; training programs; regional variation; program evaluation;

    JEL classification:

    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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