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End-of-Year Spending and the Long-Run Employment: Effects of Training Programs for the Unemployed

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  • Fitzenberger, Bernd
  • Furdas, Marina
  • Sajons, Christoph

Abstract

This study re-estimates the employment effects of training programs for the unemployed using exogenous variation in participation caused by budget rules in Germany in the 1980s and early 1990s, resulting in the infamous "end-of-year spending". In addition to estimating complier effects with 2SLS, we implement a exible control-function approach to obtain the average treatment effect on the treated (ATT). Our findings are: Participants who are only selected for budgetary reasons do not benefit from training programs. However, the ATT estimates suggest modest positive effects in the long run. Longer programs are more effective than shorter and more practice-oriented programs.

Suggested Citation

  • Fitzenberger, Bernd & Furdas, Marina & Sajons, Christoph, 2017. "End-of-Year Spending and the Long-Run Employment: Effects of Training Programs for the Unemployed," VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168310, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc17:168310
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    Cited by:

    1. Miroslav Štefánik & Katarína Karasová & Ivana Studená, 2020. "Can supporting workplace insertions of unemployed recent graduates improve their long-term employability?," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 47(2), pages 245-265, May.
    2. Christoph Siemroth, 2022. "Dezemberfieber senken: Vermeidung von verschwenderischen Jahresendausgaben [Reducing “Dezemberfieber”: Wasteful Year-End Spending and a Solution]," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 102(6), pages 461-464, June.
    3. Steve Machin & Sandra McNally & Camille Terrier & Guglielmo Ventura, 2020. "Closing the Gap between Vocational and General Education? Evidence from University Technical Colleges in England," CESifo Working Paper Series 8678, CESifo.
    4. Jorge Rodríguez & Fernando Saltiel & Sergio Urzúa, 2022. "Dynamic treatment effects of job training," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 37(2), pages 242-269, March.
    5. Agata Maida & Daniela Sonedda, 2019. "Getting out of the starting gate on the right foot: employment effects of investment in human capital," LABORatorio R. Revelli Working Papers Series 164, LABORatorio R. Revelli, Centre for Employment Studies.
    6. Stuart Baumann, 2019. "Putting It Off for Later: Procrastination and End of Fiscal Year Spending Spikes," Scandinavian Journal of Economics, Wiley Blackwell, vol. 121(2), pages 706-735, April.
    7. Stuart Baumann, 2015. "Putting it off for later," Edinburgh School of Economics Discussion Paper Series 260, Edinburgh School of Economics, University of Edinburgh.

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    More about this item

    Keywords

    Training for the unemployed; budgetary conditions; administrative data; Germany;
    All these keywords.

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate

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