Before and After the Hartz Reforms: The Performance of Active Labour Market Policy in Germany



18


Lena Jacobi and Jochen Kluve

Fitzenberger/Speckesser (2005) cover the period 1993-1997. The most com-
prehensive study is the one by Lechner et al. (2005) who use data covering the
period of 1993 to 2002. Due to the richness of the data, various types of
training programmes can be distinguished. Fitzenberger/ Speckesser (2005)
concentrate on “provision of specific professional skills” which is a special
type of further vocational training programmes. Lechner et al. (2005) dis-
tinguish short training (up to 6 months), long training (over 6 months), re-
training, and training in practice firms.

All studies based on the new data find significant evidence of locking-in
effects for virtually all types of training programmes, i.e. the labour market
performance is worse for participants compared to non-participants during
and shortly after participation. The central question is whether there are
positive effects in the medium and long run that are big enough to be able to
compensate these negative short run effects. The answer seems to depend on
the outcome variable. For unemployment duration, Hujer et al. (2004a) do not
find significant long term effects of short and medium training programmes
but find negative effects of long programmes, which means they increase un-
employment duration (here, a participating person is considered unem-
ployed). This contrasts with the other studies, Fitzenberger/Speckesser (2005)
and Lechner et al. (2005), who take the employment rate as outcome measure
and find positive effects in the long run for programmes that provide specific
professional skills (Fitzenberger, Speckesser 2005) as well as for short training
and retraining programmes (Lechner et al. 2005). Lechner et al. (2005) also
use monthly earnings as an outcome variable and again find positive effects in
the long run.

Early studies on training in West Germany include Pannenberg (1995), Hujer
et al. (1998) and Hujer/Wellner (2000). These studies use models of unem-
ployment duration and are based on GSOEP data covering the second half of
the 1980s and the early 1990s. Again, results are mixed: Pannenberg (1995) and
Hujer et al. (1998) do not find significant positive effects, while Hujer/Wellner
(2000) find positive effects, however, for short term programmes only. More
recent studies based on administrative data are Klose/Bender (2000), Lechner
et al. (2004) and Fitzenberger/Speckesser (2005). Klose/Bender (2000) use a
preliminary version of the data. Fitzenberger/Speckesser (2005) use the final
data covering the period 1993-1997, while Lechner et al. (2004) base their
study on data covering the larger period of 1993 to 2002.

Klose/Bender (2000) do not find any positive effects, which might be due to
the preliminary character of their data. In contrast, Lechner et al. (2004) as
well as Fitzenberger/Speckesser (2005) come to quite optimistic results.
Fitzenberger/Speckesser (2005) find negative locking-in effects on the em-
ployment rate in the short run and significantly positive effects in the long run



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