Does the Order and Timing of Active Labor Market Programs Matter?

IZA Discussion Paper No. 3092

University of St. Gallen, Department of Economics, Discussion Paper No. 2007-38

35 Pages Posted: 16 Oct 2007

See all articles by Michael Lechner

Michael Lechner

University of St. Gallen - Swiss Institute for Empirical Economic Research

Stephan Wiehler

University of St. Gallen - Swiss Institute for International Economics and Applied Economic Research

Date Written: October 2007

Abstract

This paper extends the traditional focus of active labor market policy evaluation from a static comparison of participation in a program versus nonparticipation (or participation in another program) to the evaluation of the effects of program sequences, i.e. multiple participation or timing of such programs. We use a dynamic evaluation framework that explicitly allows for dynamic selection into different stages of such sequences based on past intermediate outcomes to analyze multiple programs, the timing of programs, and the order of programs. The analysis is based on exceptionally comprehensive data on the Austrian labor force. Our findings suggest that (i) active job search programs are more effective after a qualification program compared to the reverse order, that (ii) multiple participations in qualification measures dominates single participation, and that (iii) the effectiveness of specific labor market programs deteriorates the later they start during an unemployment spell.

Keywords: Active Labor market policy, matching estimation, program evaluation, panel data

JEL Classification: J68

Suggested Citation

Lechner, Michael and Wiehler, Stephan, Does the Order and Timing of Active Labor Market Programs Matter? (October 2007). IZA Discussion Paper No. 3092, University of St. Gallen, Department of Economics, Discussion Paper No. 2007-38, Available at SSRN: https://ssrn.com/abstract=1021679

Michael Lechner (Contact Author)

University of St. Gallen - Swiss Institute for Empirical Economic Research ( email )

Varnbuelstrasse 14
St. Gallen, 9000
Switzerland
+41 71 224 2320 (Phone)

Stephan Wiehler

University of St. Gallen - Swiss Institute for International Economics and Applied Economic Research ( email )

Dufourstr. 48
St. Gallen, 9000
Switzerland

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