Active Labour Market Policies in Poland: Human Capital Enhancement, Stigmatization or Benefit Churning?

CEPR Working Paper No. 2059

52 Pages Posted: 11 Dec 2000

See all articles by Jochen Kluve

Jochen Kluve

Humboldt University of Berlin; RWI; IZA

Hartmut Lehmann

University of Bologna - School of Economics, Management, and Statistics; IZA Institute of Labor Economics

Christoph M. Schmidt

RWI - Leibniz-Insitut für Wirtschaftsforschung (RWI Essen); Ruhr-Universität Bochum (RUB); Institute for the Study of Labor (IZA); Centre for Economic Policy Research (CEPR)

Date Written: January 1999

Abstract

This paper provides micro-econometric evidence on the effectiveness of Active Labor Market Policies (ALMP) in Poland. We sketch the theoretical framework of matching estimators as a substitute for randomization in labor market programs. Using retrospective data from the 18th wave of the Polish Labor Force Survey we implement a conditional difference-in-differences matching estimator of treatment effects. Treatment and control groups are matched over individual observable characteristics and pre-treatment labor market histories to minimize bias from unobserved heterogeneity. We also require that observations on controls are from the same regional labor market and from an identical phase of the transition cycle. Considering as the outcome a multinomial variable of labor market status, our first important finding suggests that training of men and women has a positive effect on the employment probability. For men public works and intervention works have negative treatment effects, while participation in intervention works does not affect women's employment probabilities. We attribute the negative treatment effects for men to benefit churning rather than to stigmatization of intervention and public works participants.

JEL Classification: C41, J68

Suggested Citation

Kluve, Jochen and Lehmann, Hartmut F. and Schmidt, Christoph M., Active Labour Market Policies in Poland: Human Capital Enhancement, Stigmatization or Benefit Churning? (January 1999). CEPR Working Paper No. 2059. Available at SSRN: https://ssrn.com/abstract=155089

Jochen Kluve (Contact Author)

Humboldt University of Berlin ( email )

Spandauer Str. 1
Berlin, D-10099
Germany

RWI ( email )

Essen
Germany

IZA

P.O. Box 7240
Bonn, D-53072
Germany

Hartmut F. Lehmann

University of Bologna - School of Economics, Management, and Statistics ( email )

Piazza Scaravilli 1
40126 Bologna, fc 47100
Italy

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Christoph M. Schmidt

RWI - Leibniz-Insitut für Wirtschaftsforschung (RWI Essen) ( email )

Hohenzollernstraße 1-3
Essen, 45128
Germany
++49 201 8149-227 (Phone)
++49 201 8149-236 (Fax)

Ruhr-Universität Bochum (RUB)

GC 2/150
Universitätsstr. 150
D-44780 Bochum
Germany

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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