DP5924 Active Labour Market Policy in East Germany: Waiting for the Economy to Take Off

Author(s): Michael Lechner, Conny Wunsch
Publication Date: November 2006
Keyword(s): causal effects, matching estimation, panel data, programme evaluation
JEL(s): J68
Programme Areas: Labour Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=5924

We investigate the effects of the most important East German active labour market programmes on the labour market outcomes of their participants. The analysis is based on a large and informative individual database coming from administrative data sources. Using matching methods, we find that over a horizon of 2.5 years after programme start the programmes fail to increase the employment chances of their participants in the regular labour market. However, the programmes may have other effects for their participants that may be considered important in the especially difficult situation experienced in the East German labour market.