Explaining the Employability Gap of Short-term and Long-term Unemployed Persons

This paper analyzes the determinants of employability differences between short-term and long-term unemployed persons. Knowing these differences could help to address active labor market policy programs more adequately to the needs of the job-seekers in order to increase employment integration. Based on merged survey and register data differences in job finding chances of these groups are decomposed into a part due to differences in attributes and a part due to differences in valuing the attributes. The estimates clarify that current active labor market programs do not address important factors of employment. Particularly, health of the job seekers, limitations in the working ability and obstacles to employment comprising substance abuse, financial debts or care obligations for children or frail elderly play a significant role for successful placement. The conclusion is that policy makers should integrate these aspects in the placement process. --unemployment,employability,active labor market policy,decomposition,Germany

Explaining the Employability Gap of Short-term and Long-term Unemployed Persons

This paper analyzes the determinants of employability di erences between short-term and long-term unemployed persons. Knowing these di erences could help to address active labor market policy programs more adequately to the needs of the job-seekers in order to increase integration rates into employment. Based on merged survey and register data di erences in job nding chances of these groups are decomposed into a part due to di erences in attributes and a part due to di erences in valuing the attributes. The estimates clarify that current active labor market programs do not address important factors of employment. Particularly, health of the job seekers, limitations in the working ability and obstacles to employment comprising drug abuse, nancial debts or care obligations for children or frail elderly play a signi cant role for successful placement. The conclusion is that policy makers should integrate these issues in the placement process.unemployment, employability, self-reported job chances, active labor market policy, decompo- sition, Germany

Temporary extra jobs for immigrants: Merging lane to employment or dead-end road in welfare?

We evaluate the effects of the most frequently used German welfare-to-work program on the employment chances of immigrant welfare recipients. In particular, we investigate whether program effects differ between immigrants and natives and what might cause these potential differences. Our results reveal that the program fails to achieve its objectives. The effects are more adverse for natives, but the program does not help otherwise identical immigrants to leave the welfare system either. Therefore, the program is a dead-end road rather than a merging lane to regular employment both for natives and for immigrants. --Immigrants,employment programs,evaluation,decomposition of effects,Germany

Crowding out Informal Care? Evidence from a Social Experiment in Germany

This paper evaluates the effects of a professionally assisted consumer-directed program (Personal Budgets) compared to the standard home care programs of the German long-term care insurance. The evaluation makes use of a long-run social experiment at seven different sites with a random assignment into a treatment group receiving personal budgets and a control group in standard home care programs, i.e. an in-kind benefit (agency care) and cash payments. Compared to agency care personal budgets yield better care outcomes with regard to the overall support of formal and informal caregivers. In contrast, personal budgets do not improve care outcomes compared to the much less generous cash payments due to a strong crowding out of informal by formal care. --consumer-directed long-term care,social experiment,personal budget,evaluation,Germany

How do employment effects of job creation schemes differ with respect to the foregoing unemployment duration?

Based on new administrative data for Germany covering entrances into job creation schemes between July 2000 and May 2001, we evaluate the effects of this active labour market policy programme on the employability of the participating individuals. The programme effects are estimated considering the timing of treatment in the individual unemployment spell. Applying propensity score matching in a dynamic setting where the time until treatment in the unemployment spell is stratified into quarters, regional (East and West Germany) as well as gender differences are considered in the estimation. As matching is concerned with selection on observables only, we test the robustness of the estimates against possible unobserved influences. The results in terms of employment present a mixed picture. For West Germany, most of the estimates are insignificant at the end of the observation period, but positive exceptions are found for persons starting in the fifth or ninth quarter of the unemployment spell. For East Germany, none of the groups experiences an improvement of the labour market situation. Instead, the majority of the estimates establish negative employment effects until the end of the observation period (30 months after start of programmes). Hence, job creation schemes decrease the employment chances of the participating individuals. --Evaluation,Active Labour Market Policy,Job Creation Schemes,Administrative Data,Propensity Score Matching,Hidden Bias

Noncognitive skills in economics: Models, measurement, and empirical evidence

There is an increasing economic literature considering personality. This paper provides an overview on the role of these skills regarding three main aspects of economic analysis: measurement, theoretical modeling, and empirical estimates. Based on the relevant literature from different disciplines, the common psychometric measures used to assess personality are discussed. A recently proposed theoretical framework of human capital production takes personality explicitly into account. It is reviewed to clarify the understanding of crucial features of skill development. Based on these foundations, the main results of the empirical literature regarding noncognitive skills are classified along the research questions and summarized. --noncognitive skills,personality,human capital formation,psychometric measures

Reforming Home Care Provision in Germany: Evidence from a Social Experiment

In a long-run social experiment, personal budgets have been tested as an alternative to the home care programs of the German long-term care insurance (LTCI). Due to extending the coverage beyond LTCI approved services and agencies, personal budgets may improve care outcomes compared to the provision of agency care at a constant benefit level, a highly desirable result in light of the ongoing demographic challenge. However, personal budgets also compete with the less generous cash option of the LTCI. Any transition from cash recipients to personal budgets increases LTCI spending, while care outcomes may remain unchanged if informal caregivers are crowded out by formal care. This paper compares care outcomes of the different home care programs and provides a rough cost analysis from the perspective of the LTCI. While personal budgets improve care outcomes compared to agency services, the nationwide introduction of personal budgets increases LTCI spending for former cash recipients without any traceable effect on their care outcomes. --consumer directed long-term care,agency care,social experiment,Germany

Identifying effect heterogeneity to improve the effiency of job creation schemes in Germany?

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. JEL: C13 , J68 , H4

The effects of vocational training programmes on the duration of unemployment in Eastern Germany

Vocational training programmes have been the most important active labour market policy instrument in Germany in the last years. However, the still unsatisfying situation of the labour market has raised doubt on the efficiency of these programmes. In this paper, we analyse the effects of the participation in vocational training programmes on the duration of unemployment in Eastern Germany. Based on administrative data for the time between the October 1999 and December 2002 of the Federal Employment Administration, we apply a bivariate mixed proportional hazards model. By doing so, we are able to use the information of the timing of treatment as well as observable and unobservable influences to identify the treatment effects. The results show that a participation in vocational training prolongates the unemployment duration in Eastern Germany. Furthermore, the results suggest that locking-in effects are a serious problem of vocational training programmes. JEL Classification: J64, J24, I28, J6