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Does active labour market policy affect structural unemployment? An empirical investigation for West German regions, 1986 to 1993

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  • Büttner, Thiess
  • Prey, Hedwig

Abstract

In this paper, the impact of two instruments of active labor market policy (ALMP), namely continuous training programs and job creation schemes, on structural unemployment in West Germany for the period 1986 to 1993 is estimated using data for 74 planning regions. Based on a disequilibrium approach, we focus on a possible effect of ALMP programs on the labor market mismatch. Taking care of endogeneity, we do not find an effect of training programs on the mismatch. For job-creation schemes, the estimates reveal positive effects on the matching-efficiency, indicating that they contributed to a reduction in the structural rate of unemployment in West Germany during the time period considered.

Suggested Citation

  • Büttner, Thiess & Prey, Hedwig, 1997. "Does active labour market policy affect structural unemployment? An empirical investigation for West German regions, 1986 to 1993," Discussion Papers 42, University of Konstanz, Center for International Labor Economics (CILE).
    • Handle: RePEc:zbw:koncil:42
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    References listed on IDEAS

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    2. Layard, Richard & Nickell, Stephen & Jackman, Richard, 2005. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780199279173, Decembrie.
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    9. Markus Pannenberg & Johannes Schwarze, 1996. "Unemployment, Labor Market Training Programs and Regional Wages: An Extended Wage Curve Approach," Discussion Papers of DIW Berlin 139, DIW Berlin, German Institute for Economic Research.
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    12. R. Hujer & K.-O. Maurer & M. Wellner, 1997. "Estimating the Effect of Training on Unemployment Duration in West Germany - A Discrete Hazard-Rate Model with Instrumental Variables," Econometrics 9704001, University Library of Munich, Germany.
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    Cited by:

    1. Verónica Escudero, 2018. "Are active labour market policies effective in activating and integrating low-skilled individuals? An international comparison," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-26, December.
    2. repec:ilo:ilowps:487304 is not listed on IDEAS

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