Identifying Effect Heterogeneity to Improve the Effiency of Job Creation Schemes in Germany?
Institute for the Study of Labor (IZA)
University of Frankfurt; Institute for the Study of Labor (IZA)
Stephan Lothar Thomsen
Centre for European Economic Research (ZEW)
ZEW - Centre for European Economic Research Discussion Paper No. 05-021
Previous empirical studies of job creation schemes in Germany have shown that the average effects for the participating individuals are negative. However, we find that this is not true for all strata of the population. Identifying individual characteristics that are responsible for the effect heterogeneity and using this information for a better allocation of individuals therefore bears some scope for improving programme efficiency. We present several stratification strategies and discuss the occurring effect heterogeneity. Our findings show that job creation schemes do neither harm nor improve the labour market chances for most of the groups. Exceptions are long-term unemployed men in West and long-term unemployed women in East and West Germany who benefit from participation in terms of higher employment rates.
Number of Pages in PDF File: 36
Keywords: Evaluation, active labour market policy, targeting, efficient allocation, effect heterogeneity
JEL Classification: C13, H43, J68working papers series
Date posted: April 29, 2005 ; Last revised: August 18, 2008
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