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Inhaltsbereich: Institut für Arbeitsmarkt- und Berufsforschung


    Employment effects of the new German minimum wage

    17 March 2016

    In Germany a new statutory minimum wage of € 8.50 per hour of work was introduced on 1 January 2015. The authors identify employment effects using variation in the establishment-level affectedness. The data allow them to address anticipatory wage adjustments as well as spillover effects within and across workplaces. Difference-indifferences estimation reveals an increase in average wages by 4.8 percent and an employment reduction by about 1.9 percent in affected establishments. These estimates imply an employment elasticity with respect to wages of about -0.3.

    IAB-Discussion Paper 10/2016

    Differences in welfare take-up between immigrants and natives

    01 March 2016

    The authors study whether immigrants in Germany differ in their take-up behavior conditional on being eligible for receiving welfare benefits relative to their German counterparts. The empirical approach aims (i) to determine eligibility for welfare benefits for a representative sample of the whole population in Germany using a microsimulation model based on data from the German Socio-Economic Panel (GSOEP) and then (ii) to estimate probit models of observed welfare benefit take-up for the sample of eligible households.

    IAB-Discussion Paper 8/2016

    The productivity effects of worker mobility between heterogeneous firms

    29 February 2016

    Several empirical studies find that worker inflows from more productive or otherwise superior firms increase hiring firms’ productivity. The authors conduct a similar analysis for Germany, using a unique linked employer-employee data set, and ranking sending and hiring establishments by their median wage.

    IAB-Discussion Paper 7/2016

    Regional age structure and young workers‘ wages

    22 February 2016

    This paper estimates the effect that changes in the size of the youth population have on the wages of young workers. Assuming that differently aged workers are only imperfectly substitutable, economic theory predicts that individuals in larger age groups earn lower wages. We test this hypothesis for a sample of young, male, fulltime employees in Western Germany during the period 1999-2010.

    IAB-Discussion Paper 6/2016

    Labour shortages and replacement demand in Germany

    17 February 2016

    Two stylised facts of the German labour market are that first, the demand for highskilled labour has been growing rapidly for a number of years and second, the country is facing a particularly strong demographic change with the expected size of the population decreasing rapidly and the average age of the labour force increasing sharply. This has led to a widely discussed fear of 'labour shortages'. One of the reasons often stated in the public debate is that within a given time period many more old individuals are retiring than young individuals are entering the labour market. Although there is a certain logic in this argument, it is only prima facie convincing because firstly, a change in labour demand could counteract this effect and secondly, it is unclear whether - given labour demand for the occupations people retire from - people retiring from the labour market are normally 'replaced' by young cohorts entering the labour market. Thirdly, even if the size of a cohort differs between generations, it is by no means clear what the effects on labour supply are as, for example, the participation rates may also differ. We address these issues from a theoretical and empirical perspective. In the theoretical part we focus on the relationship between vacancies and unemployment (labour-market tightness) and show that it does not always increase with demographic change. In the empirical part, we analyse how employment is affected over time by different shares of different age cohorts.

    IAB-Discussion Paper 5/2016

    Replacement migration from a labour market perspective

    12 February 2016

    We quantify the development of the potential labour force in Germany from 2014 to 2050 and pose the question as to which extent migration will be able to offset the well-known negative demographic influence. The mean overall results of this long period of time show that while migration may slightly dampen the trend, it cannot fully compensate for it, depending on the development of domestic labour participation. Persistently high immigration numbers, however, will defer the demographic caused decline of the workforce for some years. In contrast, even high, if realistic, immigration flows will only slow down demographic ageing.

    IAB-Discussion Paper 4/2016

    Employment expectations and uncertainties ahead of the new German minimum wage

    02 February 2016

    Followed by an extensive policy discussion late 2013 and early 2014, the new German minimum wage was introduced on 1 January 2015. This article analyzes announcement effects of the new statutory minimum wage on employer expectations in 2014. The IAB Establishment Panel allows for a difference-in-differences comparison between affected and unaffected employers and entails variables that address the employers' employment expectations. In 2014, affected employers show an increased employment uncertainty and a drop in their expected employment development. They also more likely report wage costs to become a problem. In size, the employment expectations translate into a loss of about 12 800 jobs.

    IAB-Discussion Paper 3/2016

    The role of sickness in the evaluation of job search assistance and sanctions

    26 January 2016

    Unemployment insurance agencies may combat moral hazard by punishing refusals to apply to assigned vacancies. However, the possibility to report sick creates an additional moral hazard, since during sickness spells, minimum requirements on search behavior do not apply. This reduces the ex ante threat of sanctions. We analyze the effects of vacancy referrals and sanctions on the unemployment duration and the quality of job matches, in conjunction with the possibility to report sick.

    IAB-Discussion Paper 2/2016

    Endowment redistribution and Pareto improvements in GEI economies

    13 January 2016

    With incomplete markets and numeraire assets, there are open sets of economies such that their equilibrium allocations can be improved upon by a reallocation of period zero endowments. This strengthens the classical results on constrained Pareto inefficiency of equilibria in GEI.

    IAB-Discussion Paper 1/2016

    Industry 4.0 and the consequences for labour market and economy

    16 December 2015

    This study focuses on the economic effects of the phenomenon of “Industry 4.0”, the digitalisation of the production processes. These developments involve considerable challenges for companies as well as on a political level. The results show that Industry 4.0 will accelerate the structural change towards more services. In the process, labour force movements between sectors and occupations are significantly greater than the change of the number of employees overall.

    IAB-Forschungsbericht 8/2015

    Measuring the use of human resources practices and employee attitudes

    04 December 2015

    This paper introduces a new data source available for HRM researchers and personnel economists, the Linked Personnel Panel (LPP). The LPP is a longitudinal and representative employer-employee data set covering establishments in Germany and designed for quantitative empirical HR research. The LPP offers a unique structure. First, the data set combines employer and employee surveys that can be matched to each other. Second, it can also be linked to a number of additional administrative data sets. Third, the LPP covers a wide range of firms and workers from different backgrounds. Finally, because of its longitudinal dimension, the LPP should facilitate the study of causal effects of HR practices. The LPP employee survey uses a number of established scales to measure job characteristics and job perceptions, personal characteristics, employee attitudes towards the organisation and employee behaviour. This paper gives an overview of both the employer and employee survey and outlines the definitions, origins and statistical properties of the scales used in the individual questionnaire.

    IAB-Discussion Paper 35/2015

    Under heavy pressure

    01 December 2015

    With the introduction of a new welfare benefit system in 2005, Germany implemented quite strict benefit sanctions for welfare recipients aged younger than 25 years. For all types of non-compliance except for missing appointments, their basic cash benefit is withdrawn for three months. A second sanction of the same type within one year implies a complete benefit cut for three months. We analyze the impact of these sanctions on job search outcomes and on transitions out of the labor force. Our analysis is based on administrative data on a large inflow sample of young male jobseekers into welfare in West Germany.

    IAB-Discussion Paper 34/2015

    Special Issue “lidA - German Cohort Study on Work, Age and Health” of the Journal for Labour Market Research

    30 November 2015

    The lidA study group, a cooperation between the Universities of Wuppertal, Ulm and Magdeburg, the IAB, the Institute for Applied Social Sciences (infas) and the Federal Institute for Occupational Safety and Health (BAuA) set up the 'lidA Cohort Study - German Cohort Study on Work, Age, Health and Work Participation' to investigate the effects of work and work context on the physical and psychological health of the ageing workforce in Germany. The articles in this special issue combine a sample of papers presenting results gained from the lidA study and papers presented at the workshop took place in Nuremberg in October 2012.

    Access to full-texts via the publisher (possibly at a charge): lidA - German Cohort Study on Work, Age and Health (Volume 48, Issue 3, October 2015)

    Commuting farther and earning more?

    25 November 2015

    Over the past several decades, most industrialized countries have experienced a rise in commuting distances, spurring scholarly interest in its determinants. The primary theoretical explanation for longer commuting distances is based on higher wages; however, empirical evidence is minimal.

    IAB-Discussion Paper 33/2015

    Long-term unemployment and labor force participation

    19 November 2015

    We sharpen tests for 'discouragement' and 'added worker' effects by splitting the explanatory variable - the unemployment rate - into a short-term and a long-term component. While short-term unemployment might not result in additional workers on a large scale, long-term unemployment reduces household income more, increasing the need for additional income. On the other hand, it may discourage older workers for psychological and sociological reasons. Applying our model to the German labor market, these hypotheses could be confirmed. Even for men, about whom only few empirical studies on this issue are available, distinguishing between short-term and long-term unemployment reveals discouragement effects."

    IAB-Discussion Paper 32/2015

    IAB offers internships for refugees

    06 November 2015

    For IAB, the integration of refugees into the labour market is not only a matter of research but also a question of practical commitment. This is the reason why in 2016 we are making a total of ten internships available to refugees. The offer is aimed at persons who have fled from their home countries. They should already have studied in their home country, ideally economic or social sciences. A good knowledge of English or German is a prerequisite.

    You can find more information under Internship at IAB. Please address applications to:

    The impact of changing youth employment patterns on future wages

    06 November 2015

    This study examines employment patterns on the labor market for German apprenticeship graduates and returns to early-career employment stability over the past four decades. The data indicate the decreasing stability of youth employment since the late 1980s. Exploiting variation in the timing of macroeconomic shocks, I identify true state dependencies and find that stable employment early in professional life exhibits significant wage returns in future periods. These returns are particularly pronounced at the bottom of the wage distribution and have substantially increased during the 1990s. Accordingly, securing the training-to- work transitions would primarily be beneficial for the wage growth of workers with a generally low earning potential.

    IAB-Discussion Paper 31/2015

    Forecasting employment in Europe: Are survey results helpful?

    03 November 2015

    In this paper the authors evaluate the forecasting performance of employment expectations for employment growth in 15 European states. She observe the best results for one quarter ahead predictions that are primarily the aim of the survey question. However, employment expectations also work well for longer forecast horizons in some countries.

    IAB-Discussion Paper 30/2015

    Misreporting to looping questions in surveys

    30 October 2015

    Looping questions are used to collect data about several similar events, such as employment spells, retirement accounts, or marriages. Looping questions can be asked in two formats, and which format a survey uses may affect the quality of the data collected. The authors develop theory-based hypotheses about the effects that the choice of format has on measurement error in looping questions and test the hypotheses using experimental data from a recent web survey with a link to administrative records.

    IAB-Discussion Paper 29/2015 

    Detecting unemployment hysteresis

    23 October 2015

    We construct a new Markov-switching unobserved components framework for the analysis of hysteresis effects. Our model unifies the ingredients of trend-cycle decomposition, identification of spillovers between the components and asymmetry over the business cycle. Employing the model for Germany and the U.S. over 55 years, we find that the decades-long upward trend in German unemployment is fully explained by hysteresis. The Great Recession was well absorbed because both hysteresis effects and structural unemployment were substantially reduced after institutional reforms. In contrast, U.S. unemployment did not evolve according to hysteresis, not even during the Great Recession.

    IAB-Discussion Paper 28/2015

    Long-run processes of geographical concentration and dispersion

    21 September 2015

    This paper analyzes the evolution of geographical concentration in the West German manufacturing, service, and knowledge-intensive sectors over a time period of 30 years. Drawing on detailed plant data of 187 industries from 1980 to 2010, we observe substantial concentration that is highest in manufacturing. Over time, there is a trend of deconcentration encompassing all economic activity. These patterns remain stable when accounting for both various sectoral and regional levels of aggregation and spatial dependencies between neighbouring regions.

    IAB-Discussion Paper 27/2015

    Online Survey of the IAB web presence extented until October 11, 2015

    18 September 2015

    IAB-Online-BefragungThe IAB is conducting an Online Survey of its German- and English-language web presence. The aim is to gather information on the quality and variety of what IAB offers, on comprehensibility, motivation for use, and new user requirements, with a view to improving IAB's web presence even further. For this purpose we would like to hear your opinion, wishes and suggestions. We kindly ask you to take about ten minutes to take part in this Online Survey.

    Online Survey

    Information for survey participants

    Special Issue “The Transformation of the German Model” of the Journal for Labour Market Research

    17 September 2015

    The current debate about “Modell Deutschland” has been prompted by the global financial crisis that emerged in 2008 and the Hartz labour market reforms in Germany. The latest Special Issue “The Transformation of the German Model” of the Journal for Labour Market Research considers the question to what extent the main parameters of this model are still intact. Six contributions examine the following aspects of the German Model: labour market reform, production systems, vocational education and training, industrial relations, employment patterns and social policy.

    Abstract and full-text downloads (free of charge) are available until the end of September at: Transformation of the German Model (Volume 48, Issue 2, August 2015) 

    Reallocation patterns across occupations

    17 September 2015

    Using high-quality administrative data, the author analyze workers' opportunity costs of reallocation across occupations by measuring the additional time spent in unemployment before being hired in a new occupation. Furthermore, she inspect the wage changes after reallocation and find that workers who change occupations through unemployment face wage losses.

    IAB-Discussion Paper 26/2015

    Who profits from working-time accounts?

    25 August 2015

    This study brings together results of the establishment and the individual level to get a better understanding of the use of working-time accounts in Germany. Using data from the Establishment Panel we first show that industrial relations factors, employment-contract characteristics and individual characteristics determine working-time accounts’ use in establishments. Second, we provide the first analysis concerning the determinants of working-time accounts’ use among employees and the employees’ access to working-time accounts in establishments using working-time accounts.

    IAB-Discussion Paper 23/2015

    Factor structural time series models for official statistics with an application to hours worked in Germany

    21 August 2015

    The authors introduce a high-dimensional structural time series model, where co-movement between the components is due to common factors. A two-step estimation strategy is presented, which is based on principal components in differences in a first step and state space methods in a second step. The methods add to the toolbox of official statisticians, constructing timely regular statistics from different data sources.

    IAB-Discussion Paper 22/2015

    Measuring hours worked in Germany

    20 August 2015

    This article presents the IAB working time measurement concept, which determines the hours worked in Germany and their individual components. These statistics are essential for a proper analysis of aggregate labour market trends and cyclical fluctuations. The authors outline the conceptual and methodological framework of the measurement, which evolves further due to its integration in the system of national accounts and due to innovations to the statistical procedures applied.

    IAB-Discussion Paper 21/2015

    Matching Problems in the Labour Market: Between Skills Shortage and Overeducation

    05 August 2015

    In recent years, problems of matching the skill requirements of jobs and employees’ qualifications have come into the focus of scientific discussions. Against this background, papers focusing on reasons for, or on results or measurement of such matching problems are particularly welcome.

    Call for Papers

    12th IWH/IAB-Workshop on Labour Market Policies

    Endogenizing take-up of social assistance in a microsimulation model

    08 July 2015

    Microsimulation studies typically assume that all entitlements to means-tested benefits are actually claimed by eligible households, despite a large body of research that suggests that take-up rates are substantially below 100%. The assumption of full take-up tends to exaggerate the simulated increase in caseloads and fiscal costs of a social policy reform. This paper investigates the impact of non-take-up for two hypothetical scenarios, namely increasing and decreasing the base amount of social assistance in Germany by €100 per month.

    IAB-Discussion Paper 20/2015

    Location choice of German multinationals in the Czech Republic

    07 July 2015

    This paper analyses the location choice of German investors in the Czech Republic based on a unique dataset covering all Czech companies with a German equity holder in 2010. The identification of the regional determinants of foreign direct investment (FDI) location is an important regional policy issue as FDI is supposed to improve the labour market conditions of the host region. Using a nested logit approach the impact of agglomeration economies, labour market conditions and distance on the location choice decision is investigated.

    IAB-Discussion Paper 19/2015

    Spatial Dependence and Heterogeneity in Empirical Analyses of Regional Labour Market Dynamics

    23 June 2015

    Empirical research in economics and social studies often treat regions within a country as independent islands. Moreover, they implicitly assume that effects or relations are homogenous across all regions. Both assumptions seem unrealistic: for example, the impact of a global shock is likely to vary from one region to another. In this issue on regional labour markets, Norbert Schanne employs novel methods in spatial econometrics to describe and forecast their development. The analysis particularly focusses on the heterogeneity of regional dynamics and the spatially structured interdependency between locations.

    IAB-Bibliothek 354

    Wages in high-tech start-ups – do academic spin-offs pay a wage premium?

    15 June 2015

    Due to their origin from universities, academic spin-offs operate at the forefront of the technological development. Therefore, spin-offs exhibit a skill-biased labour demand, i.e. spin-offs have a high demand for employees with cutting edge knowledge and technical skills that distinguish them even from other high-tech start-up firms. In order to accommodate this demand, spin-offs may have to pay a relative wage premium compared to other high-tech start-ups. However, neither a comprehensive theoretical assessment nor the empirical literature on wages in start-ups unambiguously predicts the existence and the direction of wage differentials between spin-offs and non-spin-offs. This paper addresses this research gap and examines empirically whether or not spin-offs pay their employees a wage premium.

    IAB-Discussion Paper 17/2015

    The role of innovation and agglomeration for employment growth in the environmental sector

    01 June 2015

    The environmental sector is supposed to yield a dual benefit: its goods and Services are intended to help to tackle environmental challenges and its Establishments should create new jobs. However, it is still unclear in empirical terms whether that really is the case. This paper investigates whether employment growth in ‘green’ establishments with ‘green’ products and services is higher compared to other establishments. Furthermore, the main factors determining labor demand in this field are analyzed.

    IAB-Discussion Paper 16/2015

    Individual and workplace-specific determinants of paid and unpaid overtime work in Germany

    24 April 2015

    In Germany, overtime work is a well-established instrument for varying working hours of employees and is of great importance for establishments as a measure of internal flexibility. However, not all employees are affected to the same degree by a variation of the work effort through overtime work. Besides socio-demographic factors, workplace-specific factors that provide information about the position of employees in the establishment play an important role, too. So far, we do not know enough how these workplace-specific factors are associated with overtime work. This question is at the centre of this study.

    IAB-Discussion Paper 15/2015

    Journal for Labour Market Research 1/2015

    14 April 2015

    Occupational and regional mobility as substitutes

    10 April 2015

    Job mobility offers opportunities for workers to obtain wage increases, but returns to job changes differ considerably. The authors argue that parts of this inequality result from a trade-off between occupational and regional mobility. Both mobility types offer alternative strategies to improve one’s labor market position; however, they each contain unique restrictions. High costs for regional mobility can thus evoke occupation changes, even though the resulting human capital devaluation leads to lower wage increases. The authors use linked retrospective life-course data for Germany (ALWA-ADIAB) and apply competing risks models to show that restrictions on one type of mobility drive individuals toward the other. Using fixed-effects regressions, we show that occupational mobility leads to lower wage increases compared to regional mobility.

    IAB-Discussion Paper 14/2015

    A Global Vector Autoregression (GVAR) model for regional labour markets and its forecasting performance with leading indicators in Germany

    01 April 2015

    The focus of this paper is on forecasting regional labour markets. It is broadly accepted that two aspects regarding the modeling strategy are essential for the accuracy of forecast: a parsimonious model focusing on the important structures, and the quality of prospective information. Here, we establish a Global VAR framework, a technique that considers a variety of spatio-temporal dynamics in a multivariate setting, that allows for spatially heterogeneous slope coefficients, and that is nevertheless feasible for data without extremely long time dimension. Second, we use this framework to analyse the prospective information regarding the economy due to spatial co-development of regional labour markets in Germany. The predictive content of the spatially interdependent variables is compared with the information content of various leading indicators which describe the general economic situation, the tightness of labour markets and environmental impacts like weather.

    IAB-Discussion Paper 13/2015

    AAPOR Report on Big Data

    23 March 2015

    There is a great potential in Big Data but there are some fundamental challenges that have to be resolved before its full potential can be realized. In this report we give examples of different types of Big Data and their potential for survey research. We also describe the Big Data process and discuss its main challenges.This report has four objectives: to educate the AAPOR membership about Big Data (Section 3), to describe the Big Data potential (Section 4 and Section 7), to describe the Big Data challenges (Section 5 and 6) and to discuss possible solutions and research needs (Section 8).

    AAPOR Report on Big Data

    Job mobility as a new explanation for the immigrant-native wage gap

    23 March 2015

    Theoretically, wage gaps between migrants and natives can be explained by human capital theory through either depreciation in human capital with migration or differences in endowments. However, even after considering human capital measures, an unexplained difference remains. We assume that differences in the employment trajectories of migrants and natives contribute to wages that diverge after labor market entrance. Utilizing a rich longitudinal data set (ALWA-ADIAB), we analyze the job mobility of migrants and natives in Germany and distinguish among voluntary, involuntary, internal and other job changes.

    IAB-Discussion Paper 12/2015

    Direct and indirect effects of mass layoffs

    20 March 2015

    Using a novel data set that contains precise geo-referenced information on the universe of German establishments, we analyse both the direct effects of mass layoffs and any indirect impacts on workers who are employed in the vicinity of an establishment being closed down. In line with the literature, we document economically significant impacts of mass layoffs on the employment and earnings prospects of directly displaced workers. In contrast, neither an individual-level difference-indifference approach nor an alternative establishment-level approach inspired by the spatial economics literature find evidence of additional adverse economic effects for workers or establishments indirectly exposed to mass layoffs.

    IAB-Discussion Paper 11/2015

    From deregulation to re-regulation

    12 March 2015

    From the mid-1980s until 2005 the German labour market was characterised by continuous deregulation. In the period of an improving German labour market, the German governments have since imposed measures to re-regulate the labour market in order to strengthen employees' rights. At the same time one can observe a tendency towards atypical forms of employment and an increase in low-wage employment. Two closely interrelated questions arise: What role did deregulation play with respect to the overall improvement of the German labour market and shifts in the employment structure? How could re-regulation impact labour market performance and employment structure in the future? The paper presents evidence that institutional reforms were an important driver of the improvement of the German labour market as well as of changes in the employment structure but definitely not the only one.

    IAB-Discussion Paper 10/2015

    Multinational resilience or dispensable jobs?

    03 March 2015

    This article investigates the employment development of Czech-based firms in German ownership in the years around the Great Recession of 2008/2009. The intense involvement of German firms in the economy of the neighboring country via foreign direct investment (FDI) raises the question whether under the conditions of a historically deep global downturn, Czech employees in multinational companies were confronted with an increased volatility of their jobs.

    IAB-Discussion Paper 9/2015

    Structural Unemployment in Selected Countries

    27 February 2015

    Structural – or non-cyclical – unemployment is a consequence of mismatch between worker and job profiles, institutional conditions or persistent economic shocks. There is no convention how to measure structural unemployment. The following country re-ports sketch the specific situation based on national statistics. Nonetheless, it becomes clear that low qualification, skill depreciation during long unemployment spells, and regional disparity or structural imbalances are important aspects to consider when combating structural unemployment. Typically, the individual barriers to re-integration into the labour market are manifold which necessitates specifically tailored policy measures. However, the most efficient policy would be prevention.

    This report introduces basics on structural unemployment in some member countries of the International Labour Market Forecasting Network. The Network is a cooperation of forecasters and policy advisors related to Public Employment Services. The following contributions were presented on the annual meeting 2014.

    Current report: Structural Unemployment in Selected Countries

    Do changes in regulation affect temporary agency workers' job satisfaction?

    18 February 2015

    This paper evaluates the impact on temporary agency workers' job satisfaction of a reform that considerably changed regulations covering the temporary help service sector in Germany. We isolate the causal effect of this reform by combining a difference- in-difference and matching approach and using rich survey data. We find that the change of the law substantially decreased agency workers' job satisfaction while regular workers' job satisfaction remained unchanged. Further analysis reveals that the negative effect on agency workers' job satisfaction can be attributed to a decrease in wages and an increase in perceived job insecurity.

    IAB-Discussion Paper 8/2015

    Intra-regional economic integration

    17 February 2015

    Regional clusters have attracted a great deal of attention for more than two decades. The interest comes from two major fields: regional economics and regional economic policy. At the interface between research and policy, the cluster-oriented regional information system CORIS is located. This research project generates information on supply chains, clusters, cluster participants and their embeddedness in two Bavarian regions. It provides a unique data source used for analyses in the present publication.

    IAB-Bibliothek 351

    Offshoring of medium-skill jobs, polarization, and productivity effect

    13 February 2015

    We examine the effects of endogenous offshoring on cost-efficiency, wages and unemployment in a task-assignment model with skill heterogeneity. Exact conditions for the following insights are derived. The distributional effect of offshoring (high-) low-skill-intensive tasks is similar to (unskilled-) skill-biased technology changes, while offshoring medium-skillintensive tasks induces wage polarization. Offshoring improves cost-efficiency through international task reallocation and puts a downward pressure on all wages through domestic skill-task reallocation. If elasticities of task substitution are low (high), the downward pressure on wages in neighboring skill segments is low (high) with a net effect of higher (lower) wages and employment.

    IAB-Discussion Paper 7/2015

    Higher wages or lower expectations?

    10 February 2015

    Labour shortages are a field of research that has been investigated quite thoroughly. The reactions of firms facing problems during the hiring process are, however, largely neglected in empirical literature. Our research will fill this empirical gap and shed light on the question of whether reactions according to the neoclassical theory or to the Reder Hypothesis are more common in reality.

    IAB-Discussion Paper 6/2015

    The productivity effect of migrants

    06 February 2015

    Empirical evidence for the US shows that migrants increase the productivity of regions. To explain the impact of migrants on the average firm productivity we construct a general equilibrium model with monopolistic competition a la Melitz (2003). We consider heterogeneous firms with different productivity levels and imperfect substitutability between migrants and natives. This gives rise to wage differences between natives and migrants.

    IAB-Discussion Paper 5/2015

    What could all the money do?

    27 January 2015

    Publically sponsored further trainings for the unemployed are an important measure of active labour market policies (ALMP) in Germany. Current discussions within this context also focus on the willingness to participate, which is an important prerequisite for the success of the programs. Financial incentives may foster both participation and successful completion, thereby reducing opportunity costs of these measures. We investigate the question what factors determine the motivation to participate by conducting a CATI survey among around 4.000 unemployed persons from the unemployment insurance system (Social Code III) and the means-tested basic income support system for needy recipients (Social Code II). We use a factorial survey - also known as vignette analysis - in combination with administrative data of the Federal Employment Agency (FEA), the latter providing detailed information about the individual labour market history.

    IAB-Discussion Paper 4/2015

    Exports, agglomeration and workforce diversity

    21 January 2015

    In this paper, the authors ask whether German firms (i. e., establishments) benefit from localization and urbanization externalities and face higher export proportions. They also control for a variety of establishment characteristics and workforce diversity. For this purpose, a comprehensive German data set that combines survey data and administrative data is used.

    IAB-Discussion Paper 3/2015

    Revisiting German labour market reform effects

    20 January 2015

    There is an ongoing discussion that centres on the German labour market reforms (2003-2005) and the role of these reforms in boosting the German economy. Considering that one of the main objectives of the reforms was to improve the matching process on the labour market, the author uses rich, high-frequency, and recent administrative panel data to present new details regarding the development of job-matching performance before and after the reform years.

    IAB-Discussion Paper 2/2015

    The effect of hiring subsidies on regular wages

    09 January 2015

    What happens to the wages of regular workers in establishments subsidized with hiring subsidies? Does hiring programme participants result in windfalls that are distributed among regular workers? Do these reduce their wage demands to avoid being substituted by subsidized workers? Using linked employer-employee data from Germany, I estimate the effects of subsidizing an establishment on regular workers' wages using spell fixed effects regression. I find that hiring subsidy schemes do increase the daily wages of regular workers by up to almost one per cent in the manufacturing sector. These effects are limited to large establishments and abovemedian local unemployment rates. 

    IAB-Discussion Paper 1/2015 

    Journal for Labour Market Research 4/2014

    07 January 2015

    The impact of education on personality

    22 December 2014

    This paper investigates the short-term effects of a reduction in the length of high school on students’ personality traits using a school reform carried out at the state level in Germany as a quasi-natural experiment. Starting in 2001, academic-track high school (Gymnasium) was reduced from nine to eight years in most of Germany’s federal states, leaving the overall curriculum unchanged. This enabled students to obtain a university entrance qualification (Abitur ) after a total of only 12 rather than 13 years of schooling. We exploit the variation in the length of academic-track high school over time and across states to identify the effect of schooling on students’ Big Five personality traits and on their locus of control.

    IAB-Discussion Paper 29/2014

    Active labour-market policies in Germany

    19 December 2014

    Active labour-market policy (ALMP) not only affects the labour-market success of participants. Due to indirect effects, they might also affect the job perspectives of non-participants. Hence, even if ALMP programmes have a positive effect for the participants, this does not mean that ALMP improves the labour-market situation as a whole. Therefore, this paper deals with the question whether ALMP improves the matching-process between job-seekers and vacancies and thus increases the total number of outflows from unemployment into employment at the regional level. To answer this question, we use data for local employment offices of the German Federal Employment Agency for the time period 2006 to 2010 and focus on job-seekers subject to unemployment insurance.

    IAB-Discussion Paper 28/2014

    New Book: Privacy, Big Data, and the Public Good

    19 December 2014

    “Privacy, Big Data, and the Public Good: Frameworks for Engagement” is the title of a new book presented in New York in July. The book is edited by Julia Lane, Senior Managing Economist at American Institutes for Research, Victoria Stodden, Assistant Professor of Statistics at Columbia University, Helen Nissenbaum, Professor of Media, Culture and Communication and Computer Science at New York University, and Stefan Bender, Head of the Research Data Centre of the Federal Employment Agency at the IAB. The book provides an accessible summary of the important legal, economic, and statistical thoughts on the many privacy issues associated with the use of big data. It also contains practical suggestions for protecting privacy and confidentiality that can help to guide practitioners.

    Further information about the book

    Book review (free of charge)

    Demography and unemployment in East Germany

    01 December 2014

    The authors analyze the relation between population aging and the decline of unemployment in East Germany for the years from 1996 to 2012. To this they scrutinize both a direct and an indirect effect of aging on unemployment. The direct effect includes a decomposition of the East German unemployment rate into three components considering changes in the workforce’s age structure, labor market participation, and age-specific unemployment rates. Results show that changes in the age structure of the workforce counteracted unemployment decline since 2005. Spatial panel regressions on the small-scale regional level, however, point towards an indirect effect of aging on unemployment that works through the increasing competition for labor.

    IAB-Discussion Paper 26/2014

    Differential pricing and private provider performance

    27 November 2014

    In many countries, employment services are contracted out to private providers. However, there is little evidence on the contract design as well as on the effects of differential pricing on private provider performance. This paper contributes to the literature by presenting detailed information on the contract design and compensation of German private employment service providers in 2009 and 2010.

    IAB-Discussion Paper 25/2014

    Aspects of wage dynamics in Germany

    04 November 2014

    Wage inequality in Germany has been rising significantly over the last decades. By now, about one fifth of all employees in Germany are working in the low-wage sector. At the same time, only a fraction of the low-wage workers manage to move up to better-paid jobs. Jens Stephani investigates various research questions concerning the upward wage mobility of low-wage workers which have not been analysed previously: How big are the chances of low-wage workers to stay in higher-paid employment for a longer term after moving up? Which establishments provide above-average wage increases for low-wage workers? How important are personality traits for the chances of low-wage workers moving up? In a separate chapter, Stephani analyses the extent to which the wage levels in establishments that are covered by collective bargaining agreements are still higher than the wage levels in uncovered establishments, despite the decline in unionism in Germany over the last decade.

    IAB-Bibliothek 350

    Trade and unions: Can exporters benefit from collective bargaining?

    20 October 2014

    Unions are often stigmatized as being a source of inefficiency due to higher collective bargaining outcomes. This is in stark contrast with the descriptive evidence presented in this paper. Larger firms choose to export and are also more likely to adopt collective bargaining. We rationalize those stylized facts using a partial equilibrium model that allows us to evaluate firms' value functions under individual or collective bargaining. Exporting further decreases average production costs for large firms in the collective bargaining regime, allowing them to benefit from additional external economies of scale due to lower bargaining costs. Our findings suggest that the positive correlation between export status and collective bargaining can be explained through size.

    IAB-Discussion Paper 24/2014 

    The implementation of the German Classification of Occupations 2010 in the IAB Job Vacancy Survey

    30 September 2014

    The IAB-Job Vacancy Survey (IAB-JVS) is the only establishment survey in Germany which contains information about vacancies and new hires on an occupational level. When the new German Classification of Occupations 2010 was introduced, it became necessary to integrate it into the IAB-JVS. This report outlines the implementation of the new classification into the IAB-JVS questionnaire. It was conducted simultaneously with the renewal of the international classification, from ISCO-88 to ISCO-08.

    IAB-Forschungsbericht 10/2014

    Literature database of IAB

    26 September 2014

    Bücher in einem Bücherregal

    The literature database of IAB is accessible free-of-charge via the professional social-science portal sowiport. It contains roughly 140,000 instances of labour market-relevant literature, frequently along with an abstract and a link to full text. Here it is not only a question of IAB publications but – since the founding of IAB (the Institute for Employment Research) – also of a general literature database which has been built up and continually updated.

    Literature database of IAB

    Employment and earnings effects of awarding training vouchers in Germany

    17 September 2014

    In 2003, Germany moved from a system in which participants in training programs for the unemployed are assigned by caseworkers to an allocation system using vouchers. Based on the rich administrative data for all vouchers and on actual program participation, we provide inverse probability weighting and ordinary least squares estimates of the employment and earnings effects of a voucher award.

    IAB-Discussion Paper 23/2014

    Determinants of labor shortage - with particular focus on the German environmental sector

    29 August 2014

    Despite the ongoing discussion on labor shortage in the German economy there is still a lack of empirical analyses of this problem based on adequate econometric methods. The paper explores the determinants of labor shortage in the environmental sector supplying products and services that help to reduce environmental impacts and energy use. Labor shortages occur when the price adjustment mechanism is too slow to balance labor demand and supply. The empirical analysis of labor shortage uses recent data of the establishment panel of the Institute for Employment Research in Nuremberg. A descriptive analysis shows that the environmental sector seems to be over-proportionally affected by labor shortage.

    IAB-Discussion Paper 22/2014

    On GDP-employment decoupling in Germany

    29 August 2014

    This paper investigates the time-varying relationship between German output and employment growth, in particular their decoupling in recent years. We estimate a correlated unobserved components model that allows for both persistent and cyclical time variation in the employment impact of GDP as well as an autonomous employment component capturing other factors than real output. As one result, we measure a permanent decline in Verdoorn's coefficient as well as pronounced effects of the autonomous employment component in the recent years. The development of the estimated impact parameters is shown to crucially depend on structural change, but also on labour availability and business expectations.

    IAB-Discussion Paper 21/2014

    Labour market effects of retraining for the unemployed

    27 August 2014

    We analyse the impact of retraining for the unemployed on future labour market success, and estimate effects separately for different target occupations. We use German registry data and apply statistical matching methods. The results show that on average, after a period with strong lock-in effects, retraining increases the employment probability of women by more than 20 percentage points. Effects for male participants are somewhat weaker. Although we find differences in the effectiveness of retraining by target occupations, these differences cannot completely explain the observed gender differences. Healthcare occupations, which are the most important target occupations especially of female participants, are among those with the strongest effects.

    IAB-Discussion Paper 20/2014

    Firm performance and trade with low-income countries

    26 August 2014

    Do firms in developing countries shift trade towards developed economies as a result of high economic growth? The matched customs-manufacturing firm data used in this study confront this hypothesized link with empirical evidence. Our analysis reveals a rising low-income country trade share around and after China's accession to the World Trade Organization. Based on this stylized fact, we analyze the link between firm characteristics and trade with low-income countries.

    IAB-Discussion Paper 19/2014

    Job polarization on local labor markets

    22 August 2014

    The labor markets of most industrialized countries are polarized. This means that employment has grown in jobs at the upper and lower tails of the wage distribution, while employment in the middle part of the distribution has stagnated or declined. However, there exists no measure that allows a quantitative comparison across different labor markets as yet. The author propose a straightforward way to measure the actual magnitude of job polarization. To demonstrate its application, he use this measure to compare polarization across German local labor markets. Job polarization almost exclusively occurs in urban areas where the hypothesis of routine biased technological change is most likely to prevail.

    IAB-Discussion Paper 18/2014

    Industry space and skill-relatedness of economic activities

    21 August 2014

    The resilience and growth prospects of a region depend crucially on the extent to which industry-specific human capital can be redeployed across the industries of a regional economy. To this end, the authors present a toolbox to analyse a region’s industrial structure, development prospects and economic resilience. With the help of this toolbox human capital similarities, or skill-relatedness, among industries are highlighted. The core of these analyses is the so-called industry space, a network that connects industries with similar human capital requirements. For the time period 1999 to 2008, a regional comparative analysis of three eastern German automobile regions, namely south-west Saxony (SWS), Eisenach region (EIS) and Leipzig region (LEI), is conducted.

    IAB-Forschungsbericht 8/2014

    Techniques for asking sensitive questions in labor market surveys

    29 July 2014

    Standard surveying techniques are usually not suited to collect valid information on the prevalence of undeclared work or receipt of basic income support. Respondents often misreport their behavior and adjust their answer in accordance with the social norm. In the social sciences alternative strategies have been developed, particularly targeted to increase respondent anonymity in the interview situation and thus reduce misreporting on sensitive topics. Antje Kirchner investigates whether these special techniques lead to higher reports of undeclared work and receipt of basic income support. Furthermore, this work presents the Item Sum Technique, a novel questioning technique that shows more promising results compared to direct questioning.

    IAB-Bibliothek 348

    Labour hoarding in Germany

    02 July 2014

    During the crisis (2008-09) Germany experienced a huge decrease in GDP. Employment, however, remained surprisingly stable. A whole strand of literature has aimed at quantifying the contribution of short-time work to the German labour market miracle. In the course of this literature we estimate the treatment effect of short-time work on employment at establishment level using a dynamic propensity score matching approach. The analysis is based on data from the IAB Establishment Panel combined with administrative data on short-time work establishments from the Federal Employment Agency. Our results do not indicate any treatment effect of short-time work on employment.

    IAB-Discussion Paper 17/2014

    Forecasting with a mismatch-enhanced labor market matching function

    27 June 2014

    This paper investigates the role of mismatch between job seekers and job openings for the forecasting performance of a labor market matching function. In theory, higher mismatch lowers matching efficiency which increases the risk that the vacancies cannot be filled within the usual period of time. We investigate whether and to what extent forecasts of German job findings can be improved by a mismatch-enhanced labor market matching function. For this purpose, we construct so-called mismatch indicators that reflect regional, occupational and qualification-related mismatch on a monthly basis. In pseudo out-of-sample tests that account for the nested model environment, we find that forecasting models enhanced by the mismatch indicator significantly outperform their benchmark counterparts for all forecast horizons ranging between one month and a year. This is especially pronounced in the aftermath of the Great Recession where a low level of mismatch improved the possibility of unemployed to find a job again.

    IAB-Discussion Paper 16/2014 

    Effectiveness of data correction rules in process-produced data

    17 June 2014

    The use of process-produced data plays a large and growing role in empirical labor market research. To address data problems, previous research have developed deductive correction rules that make use of within-person information. The authors test data reliability and the effectiveness of different correction rules for information about educational degrees as reported in German register data.

    IAB-Discussion Paper 15/2014 

    Patterns of resilience during socioeconomic crises among households in Europe (RESCuE)

    16 May 2014

    In analogy with medical and psychological findings, some parts of the vulnerable population, although experiencing the same living conditions as others, are developing resilience, which in our context means that they perform social, economic and cultural practices and habits which protect them from suffer and harm and support sustainable patterns of coping and adaption. This resilience to socioeconomic crises at household levels is the focus of the project.

    IAB-Forschungsbericht 05/2014

    Economic failure and the role of plant age and size

    12 May 2014

    This paper introduces a large-scale administrative panel data set on corporate bankruptcy in Germany that allows for an econometric analysis of involuntary exits where previous studies mixed voluntary and involuntary exits. Approximately 83 percent of all bankruptcies occur in plants with no more than 10 employees, and 61 percent of all bankrupt plants are not older than 5 years. The descriptive statistics and regression analysis indicate substantial negative age dependence with respect to bankruptcy risk but confirm negative size dependence for mature plants, only. Our results corroborate hypotheses stressing increasing capabilities and positional advantage, both predicting negative age dependence with respect to bankruptcy risk due to productivity improvements. The results are not consistent with the theories explaining age dependence via imprinting or structural inertia.

    IAB-Discussion Paper 13/2014

    The hidden winners of renewable energy promotion

    07 May 2014

    In light of Germany´s transition approaches towards a sustainable energy system this paper examines differences of employment structure and wage differentials between renewable energy establishments and their sector peers. To do so, we have developed a novel data set by linking company-level information from the German Renewable Energy Federation with establishment-level data of the IAB Establishment History Panel. According to our descriptive evidence, there are significant differences in wages and in several other characteristics. Looking at the top-four renewable energy sectors, our estimates show that human capital and other establishment- level characteristics mostly explain the wage differential among manufacturers and energy providers. However, we find a persistent 'renewable energy wage premium' of more than ten percent in the construction installation activities and the architectural and engineering services. We interpret this premium as a positive indirect effect of the promotion of renewable energies for the benefit of employees in renewable energy establishments within these two sectors.

    IAB-Discussion Paper 12/2014

    Efficiency in public input provision in two asymmetric jurisdictions with imperfect labour markets

    22 April 2014

    This paper examines efficiency in public input provision in two large jurisdictions with imperfect labour markets. It analyses how equilibrium capital tax rates and public input provision levels differ between asymmetric jurisdictions that can strategically influence the interest rate on the common capital market in an international tax competition setting. In contrast to the scenario assuming competitive labour markets, the non-cooperative equilibrium is inefficient also when governments have capital and head taxes at disposal. As a source of both the distortion in the capital allocation between jurisdictions and the inefficiency in public input provision, which can be determined in at least one of the jurisdictions, we identify the governments' incentives to decrease unemployment, and a pecuniary externality [De- Pater, J., Myers, G., 1994. Strategic capital tax competition: a pecuniary externality and a corrective device. Journal of Urban Economics 36, 66-78.] in both jurisdictions. Efficiency in public input provision can be restored, however, if the set of fiscal instruments available for regional policy makers is extended by a labour tax.

    IAB-Discussion Paper 11/2014

    Sorting within and across establishments

    17 April 2014

    Using new and unique linked employer-employee data from Germany, I examine the extent to which immigrants sort into worse-paying establishments and worse job positions within establishments. The results demonstrate that recent immigrants are particularly likely to work at low-paying workplaces. Similarly, when examining job positions within establishments, I find that immigrants are employed in lower hierarchical positions. Both the non-random sorting across establishments and the hierarchical sorting within establishments explain much of the immigrant-native wage differential. Policy measures designed to address the wage differential should therefore address immigrants' access to well-paying workplaces and job positions.

    IAB-Discussion Paper 10/2014

    Curing the sick man: The German labour market on the way to good health?

    15 April 2014

    In 1999, “The Economist” referred to Germany with the meaningful headline “The sick man of the euro”. 15 years later, the world is talking about the “German Labour Market Miracle”. Ulrich Walwei, deputy director of the IAB, describes Germany’s transformation and discusses the remaining weaknesses of the German labour market.

    Current report

    On the efficiency properties of the Roy‘s model under asymmetric information

    24 March 2014

    We consider Roy's economies with perfectly competitive labor markets and asymmetric information. Firms choose their investments in physical capital before observing the characteristics of the labor markets they will face. We provide conditions under which equilibrium allocations are constrained Pareto efficient, i.e., such that it is impossible to improve upon the equilibrium allocation by changing agents' investments and letting the other endogenous variables adjust to restore market clearing. We also provide a robust example of a class of economies where these conditions fail and where equilibria are characterized by overinvestments in high skills. Finally, we discuss some implications of our main results for the optimal taxation literature.

    IAB-Discussion Paper 8/2014

    Success and failure in the operational recruitment process

    13 March 2014

    Following microeconomic theory, every vacancy should be filled by appropriate manpower after a certain time. However, from an empirical point of view it is evident that vacancies remain unfilled as establishments cancel their search for a suitable applicant. The German Job Vacancy Survey (JVS) is a representative survey of job offers for the entire German economy and provides information about the search and matching processes for both the establishments' most recent hires and for failures in the recruitment processes. The analysis is based on a binary explanatory variable, resulting from the interaction of individual successful and unsuccessful search processes (cancellation probability). Our results show that with increasing recruitment duration, the number of search cancellations becomes more likely. Moreover, the results indicate that the probability of a search cancellation is strongly linked to the characteristics that an applicant must provide and to the way the search is organised.

    IAB-Discussion Paper 7/2014 

    Active labour market programmes for women with a partner

    04 March 2014

    A major unemployment and welfare benefit reform took place in Germany in 2005. One objective of this reform was to more strongly encourage an adult worker model of the family, with an emphasis on activating the formerly inactive. The authors' hypothesis is, however, that assignments to activation programmes, such as training or workfare, will in practice still tend to replicate patterns for the division of labour in the household that couples have become accustomed to.

    IAB-Discussion Paper 6/2014

    Journal for Labour Market Research 1-2/2014

    04 March 2014

    Revisiting the matching function

    28 February 2014

    Many labor market models use both idiosyncratic productivity and a vacancy free entry condition. This paper shows that these two features combined generate an equilibrium comovement between matches on the one hand and unemployment and vacancies on the other hand, which is observationally equivalent to a constant returns Cobb-Douglas function commonly used to model match formation. The authors use German administrative labor market data to show that the matching function correlation solely based on idiosyncratic productivity and free entry is very close to the empirical matching function.

    IAB-Discussion Paper 5/2014

    Interacting product and labor market regulation and the impact of immigration on native wages

    26 February 2014

    Does interacting product and labor market regulation alter the impact of immigration on wages of competing native workers? Focusing on the large, sudden and unanticipated wave of migration from East to West Germany after German reunification and allowing for endogenous immigration, we compare native wage reactions across different segments of the West German labor market: one segment without product and labor market regulation, to which standard immigration models best apply, one segment in which product and labor market regulation interact, and one segment covering intermediate groups of workers. We find that the wages of competing native West Germans respond negatively to the large influx of similar East German workers in the segment with almost free firm entry into product markets and weak worker influence on the decision-making of firms. Competing native workers are insulated from such pressure if firm entry regulation interacts with labor market institutions, implying a strong influence of workers on the decision-making of profit-making firms.

    IAB-Discussion Paper 4/2014

    Regional determinants of German FDI in the Czech Republic

    25 February 2014

    The attractiveness for the location of multinational firms is seen as a crucial issue for the development and prosperity of regions. This article focuses on a two-country relationship and deals with the regional distribution of German multinational firms and their affiliates in the Czech Republic. A new dataset established by the IAB covers information on the basic population of cross-border foreign direct investment (FDI) projects, thereby exceeding the number of observations in previously used databases by far. On the basis of 3,894 FDI projects the regional determinants of German cross-border investments in the Czech Republic are analysed for both the home and the host country. Alternative specifications of the gravity model are used in order to investigate the regional distribution of common investment projects that are calculated as a combination of a headquarters in a German spatial planning region and an affiliate in a Czech NUTS 3 region. Concerning the explanatory variables a distinction is made between three groups of factors: first, market size and agglomeration features of the regions; second, attributes representing the distance between the headquarters in Germany and the affiliates in the Czech Republic; and third, regional labour market characteristics. While the findings are generally in line with theoretical expectations, differences emerge between manufacturing FDI and services FDI.

    IAB-Discussion Paper 3/2014

    Beat the heap - an imputation strategy for valid inferences from rounded income data

    03 February 2014

    Questions on income in surveys are prone to two sources of errors that can cause bias if not addressed adequately at the analysis stage. On the one hand, income is considered sensitive information and response rates on income questions generally tend to be lower than response rates for other non-sensitive questions. On the other hand respondents usually don’t remember their exact income and thus tend to provide a rounded estimate. The negative effects of item nonresponse are well studied and most statistical agencies have developed sophisticated imputation methods to correct for this potential source of bias. However, to our knowledge the effects of rounding are hardly ever considered in practice, despite the fact that several studies have found strong evidence that most of the respondents round their reported income values.

    IAB-Discussion Paper 2/2014

    Your very private job agency

    13 January 2014

    This paper analyzes job referral effects that are based on residential location. We use georeferenced record data for the entire working population (liable to social security) and the corresponding establishments in the Rhine-Ruhr metropolitan area, which is Germany's largest (and EU's second largest) metropolitan area. We estimate the propensity of two persons to work at the same place when residing in the same neighborhood (reported with an accuracy of 500m×500m grid cells), and compare the effect to people living in adjacent neighborhoods. We find a significant increase in the probability of working together when living in the same neighborhood, which is stable across various specifications. We differentiate these referral effects for socioeconomic groups and find especially strong effects for migrant groups from former guestworker countries and new EU countries. Further, we are able to investigate a number of issues in order to deepen the insight on actual job referrals: distinguishing between the effects on working in the same neighborhood and working in the same establishment - probably the more accurate measure for job referrals - shows that the latter yield overall smaller effects. Further, we find that clusters in employment although having a significant positive effect play only a minor role for the magnitude of the referral effect. When we exclude short distance commuters, we find the same probabilities of working together, which reinforces our interpretation of this probability as a network effect.

    IAB-Discussion Paper 1/2024

    Journal for Labour Market Research 4/2013: Special Issue PASS

    20 December 2013

    On government-subsidized training programs for older workers

    19 December 2013

    We analyze the impact of the GermanWeGebAU programs, which are government-subsidized training measures for employed workers over 45 years old. We apply a dynamic matching approach similar to Crépon et al. (2009) and exploit novel information contained in rich German registry data. We focus on the effects on survival probability in original employment and estimate the effects separately by gender, age, job status, and program duration. We find that WeGebAU training improves the probability of remaining in paid employment by 1.0 to 2.5 percentage points in the two-year period following treatment. The effect is more pronounced for part-time workers and longer-duration program participants. Our analysis suggests that postponed labor market withdrawal is the main driver of the positive effects and that there is selection into treatment at the firm level.

    IAB-Discussion Paper 21/2013

    The impact of low-skilled immigration on female labour supply

    19 November 2013
    This paper contributes to the literature on the impact of immigrants on native female labour supply. By segmenting the market by educational levels, the authors are able to investigate which nativeborn women are more affected by an increase of low-skilled immigrants working in the household service sector. They present a model of individual choice with home production, using an harmonized dataset (CNEF) and test its main predictions.

    IAB-Discussion Paper 20/2013

    Recruiting abroad: the role of foreign affinity and labour market scarcity

    15 November 2013

    The author study the recruiting behaviour of German establishments with regard to the use of foreign labour markets. The results indicate that shortages are functional and foster the use of foreign labour markets, but the large effect of foreign affinity also reveals that the potential of immigrant workers is used selectively.

    IAB-Discussion Paper 19/2013

    The cyclicality of worker flows: Evidence from Germany

    05 November 2013

    The development of unemployment and employment is strongly determined by labor market flows. This dissertation analyzes worker flows, i.e. job findings and separations, over the business cycle. The analysis uses process-generated micro data provided by the Institute for Employment Research (IAB), which allow gaining comprehensive insights into labor market dynamics in Germany.

    IAB-Bibliothek 346

    Journal for Labour Market Research 3/2013 ( Volume 46)

    28 October 2013

    Constructing a new leading indicator for unemployment from a survey among German employment agencies

    28 October 2013

    The paper investigates the predictive power of a new survey implemented by the Federal Employment Agency (FEA) for forecasting German unemployment in the short run. Every month, the CEOs of the FEA's regional agencies are asked about their expectations of future labor market developments. We generate an aggregate unemployment leading indicator that exploits serial correlation in response behavior through identifying and adjusting temporarily unreliable predictions. We use out-of-sample tests suitable in nested model environments to compare forecasting performance of models including the new indicator to that of purely autoregressive benchmarks. For all investigated forecast horizons (1, 2, 3 and 6 months), test results show that models enhanced by the new leading indicator significantly outperform their benchmark counterparts. To compare our indicator to potential competitors we employ the model confidence set. Results reveal that models including the new indicator perform very well.

    IAB-Discussion Paper 17/2013

    The effectiveness of sequences of One-Euro-Jobs

    10 October 2013

    Many studies have analysed the effectiveness of single active labour market programmes (ALMPs) for welfare recipients in different countries. As empirical evidence reveals that welfare recipients in Germany often participate in multiple programmes, I evaluate the sequential participation of unemployment benefit II (UB-II)-recipients in ALMPs in Germany. My study uses comprehensive, administrative data to control for dynamic selection that arises in the evaluation of sequences. Using a dynamic matching approach and an inflow sample of UB-II-recipients, I analyse the effects of sequences of One-Euro-Jobs and/or UB II-receipt on labour market outcomes.

    IAB-Discussion Paper 16/2013

    Wage posting or wage bargaining?

    20 September 2013

    Using a representative establishment dataset, this paper is the first to analyze the incidence of wage posting and wage bargaining in the matching process from the employer’s side. We show that both modes of wage determination coexist in the German labor market, with about two-thirds of hirings being characterized by wage posting. Wage posting dominates in the public sector, in larger firms, in firms covered by collective agreements, and in part-time and fixed-term contracts. Jobseekers who are unemployed, out of the labor force or just finished their apprenticeship are also less likely to get a chance of negotiating. Wage bargaining
    is more likely for more-educated applicants and in jobs with special requirements as well as in tight regional labor markets.

    IAB-Discussion Paper 15/2013

    Labour market forecasting: Is disaggregation useful?

    18 September 2013

    Using the example of short-term forecasts for German employment figures, the article at hand examines the question whether the use of disaggregated information increases the forecast accuracy of the aggregate. For this purpose, the out-ofsample forecasts for the aggregated employment forecast are compared to and contrasted with forecasts based on a vector-autoregressive model, which includes not only the aggregate but also the numbers of gainfully employed people at the industry level. The Clark/West test is used in the model comparison. It becomes evident that disaggregation significantly improves the employment forecast. Moreover, fluctuation-window tests help identify the phases during which disaggregation increases forecast accuracy to the strongest extent.

    IAB-Discussion Paper 14/2013

    Migration, unemployment, and skill downgrading

    13 September 2013

    This paper analyzes the impact of the skill composition of migration flows on the host country’s labor market in a specific factors two-sector model with heterogeneous labor (low-, medium-, and highly-skilled) and price- and wage-setting behavior. The low- and medium-skilled labor markets are characterized by frictions due to wage bargaining. Moreover, we assume skill downgrading of unemployed medium-skilled workers into low-skilled labor supply. Endogenous benefits create an interdependency between the two bargaining processes.

    IAB-Discussion Paper 13/2013



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