DP5920 Are Training Programs More Effective When Unemployment Is High?

Author(s): Michael Lechner, Conny Wunsch
Publication Date: November 2006
Keyword(s): active labour market policy, causal effects, long-run effects, matching estimation, panel data, program evaluation
JEL(s): J68
Programme Areas: Labour Economics
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=5920

We estimate short, medium, and long-run individual labour market effects of training programs for unemployed by following program participation on a monthly basis over a ten-year period. Since analyzing the effectiveness of training over such a long period is impossible with experimental data, we use an administrative database compiled for evaluating German training programs. Based on matching estimation adapted to the various issues that arise in this particular context, we find a clear positive relation between the effectiveness of the programs and the unemployment rate over time.