Do Long-term Unemployed Workers Benefit from Targeted Wage Subsidies

Benjamin Schuenemann (), Michael Lechner and Conny Wunsch

No 1126, Economics Working Paper Series from University of St. Gallen, School of Economics and Political Science

Abstract: Wage subsidies are often suggested as a particularly effective policy to improve labor market chances of economically disadvantaged groups. We empirically evaluate an employer-side wage subsidy scheme targeted at the long-term unemployed in Germany. Based on program regulations and a large data set we estimate the impact of program existence locally at the eligibility threshold using an RDD framework in differences. The results suggest no significant effect of the subsidy on exit rates out of unemployment or employment stability. Employment rates up to three years after eligibility show no significant improvement. In conclusion, our findings are in contrast to previous empirical results justifying such policies.

Keywords: Wage subsidy; Long-term unemployment; Regression discontinuity (search for similar items in EconPapers)
JEL-codes: J08 J23 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2011-07
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (8)

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Related works:
Journal Article: Do Long-Term Unemployed Workers Benefit from Targeted Wage Subsidies? (2015)
Journal Article: Do Long-Term Unemployed Workers Benefit from Targeted Wage Subsidies? (2015)
Working Paper: Do Long-term Unemployed Workers Benefit from Targeted Wage Subsidies? (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:usg:econwp:2011:26

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