published in: Carloeo, F.E. and Destefanis, S. (eds.): The European Labour Market - Regional Dimensions, Physica Verlag, 2006, 287-310
Most evaluation studies of active labour market policies (ALMP) focus on the microeconometric
evaluation approach using individual data. However, as the microeconometric
approach usually ignores impacts on the non-participants, it should be seen as a first step to
a complete evaluation which has to be followed by an analysis on the macroeconomic level.
As a starting point for our analysis we discuss the effects of ALMP in a theoretical labour
market framework augmented by ALMP. We estimate the impacts of ALMP in Germany for
the time period 1999-2001 with regional data of 175 labour office districts. Due to the high
persistence of German labour market data the application of a dynamic model is crucial.
Furthermore our analysis accounts especially for the inherent simultaneity problem of ALMP.
For West Germany we find positive effects of vocational training and job creation schemes on
the labour market situation, whereas the results for East Germany do not allow profound
statements.
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