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Employment Effects of Publicly Financed Training Programs The East German Experience

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  • Kraus, Florian
  • Puhani, Patrick A.
  • Steiner, Viktor

Abstract

We analyze the effectiveness of publicly financed training and retraining programs in east Germany as measured by their effects on individual re-employment probabilities after training. These are estimated by discrete hazard rate models on the basis of individual-level panel data. We account for unobserved individual heterogeneity in both the training participation and outcome equation. The latter differentiates between transitions into "stable" and "unstable" employment after the completion of a training program. Our findings are that in the first phase of the east German transition process, when the institutions delivering the training programs were being set up, there are no positive effects of training on the probability to find stable employment. For the period of September 1992 to November 1994, when the institutional structure for the programs was in place, we find positive effects of both on?the?job and off?the?job training for women, and positive effects of off?the?job training for men.

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  • Kraus, Florian & Puhani, Patrick A. & Steiner, Viktor, 1997. "Employment Effects of Publicly Financed Training Programs The East German Experience," ZEW Discussion Papers 97-33, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:5135
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    Cited by:

    1. Erich Gundlach, 2003. "Growth Effects of EU Membership: The Case of East Germany," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 30(3), pages 237-270, September.
    2. Lechner Michael & Miquel Ruth & Wunsch Conny, 2007. "The Curse and Blessing of Training the Unemployed in a Changing Economy: The Case of East Germany After Unification," German Economic Review, De Gruyter, vol. 8(4), pages 468-509, December.
    3. Núria Rodríguez-Planas & Jacob Benus, 2007. "Evaluating Active Labor Markets in Romania," UFAE and IAE Working Papers 699.07, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    4. Cockx, Bart & Bardoulat, Isabelle, 1999. "Vocational Training: Does it speed up the Transition Rate out of Unemployment ?," LIDAM Discussion Papers IRES 1999032, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    5. Kluve, Jochen, 2010. "The effectiveness of European active labor market programs," Labour Economics, Elsevier, vol. 17(6), pages 904-918, December.
    6. Annette Bergemann & Bernd Fitzenberger & Stefan Speckesser, 2009. "Evaluating the dynamic employment effects of training programs in East Germany using conditional difference-in-differences," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(5), pages 797-823.
    7. Eichler, Martin & Lechner, Michael, 2002. "An evaluation of public employment programmes in the East German State of Sachsen-Anhalt," Labour Economics, Elsevier, vol. 9(2), pages 143-186, April.
    8. Lechner, Michael & Pfeiffer, Friedhelm & Spengler, Hannes & Almus, Matthias, 2000. "The impact of non-profit temping agencies on individual labour market success in the West German state of Rhineland-Palatinate," ZEW Discussion Papers 00-02, ZEW - Leibniz Centre for European Economic Research.
    9. Wolfgang Franz & Viktor Steiner, 2000. "Wages in the East German Transition Process: Facts and Explanations," German Economic Review, Verein für Socialpolitik, vol. 1(3), pages 241-269, August.
    10. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097, Elsevier.
    11. Schneider, Hilmar & Brenke, Karl & Jesske, Birgit & Kaiser, Lutz C. & Rinne, Ulf & Schneider, Marc & Steinwede, Jacob & Uhlendorff, Arne, 2007. "Evaluation der Maßnahmen zur Umsetzung der Vorschläge der Hartz-Kommission - Bericht 2006," IZA Research Reports 10, Institute of Labor Economics (IZA).
    12. Kraus, Florian & Puhani, Patrick A. & Steiner, Viktor, 1998. "Do public works programs work? Some unpleasant results from the East German experience," ZEW Discussion Papers 98-07, ZEW - Leibniz Centre for European Economic Research.
    13. Nuria Rodriguez-Planas† & Jacob Benus, 2007. "Evaluative Active Labor Market Programmes in Romania," Working Papers 2007-31, FEDEA.
    14. Hujer, Reinhard & Wellner, Marc, 2000. "The Effects of Public Sector Sponsored Training on Individual Employment Performance in East Germany," IZA Discussion Papers 141, Institute of Labor Economics (IZA).
    15. Lechner, Michael & Wunsch, Conny, 2006. "Active Labour Market Policy in East Germany: Waiting for the Economy to Take Off," CEPR Discussion Papers 5924, C.E.P.R. Discussion Papers.
    16. Lee, Joseph S. & Hsin, Ping-Lung, 2004. "Employee training and human capital in Taiwan," Journal of World Business, Elsevier, vol. 39(4), pages 362-376, November.
    17. Eva Reinowski & Birgit Schultz & Jürgen Wiemers, 2005. "Evaluation of Further Training Programmes with an Optimal Matching Algorithm," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 141(IV), pages 585-616, December.
    18. Reinhard Hujer & Stephan Thomsen & Christopher Zeiss, 2006. "The effects of vocational training programmes on the duration of unemployment in Eastern Germany," AStA Advances in Statistical Analysis, Springer;German Statistical Society, vol. 90(2), pages 299-321, June.
    19. Fitzenberger, Bernd & Speckesser, Stefan, 2000. "Zur wissenschaftlichen Evaluation der aktiven Arbeitsmarktpolitik in Deutschland: Ein Überblick," ZEW Discussion Papers 00-06, ZEW - Leibniz Centre for European Economic Research.
    20. Horst Feldmann, 2002. "Labour Market Policies in Transition: Lessons from East Germany," Post-Communist Economies, Taylor & Francis Journals, vol. 14(1), pages 47-84.

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    More about this item

    Keywords

    publicly financed training; evaluation studies; employment effects; sample selection; east Germany;
    All these keywords.

    JEL classification:

    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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