THE RELATIVE EFFECTIVENESS OF SELECTED ACTIVE LABOR MARKET PROGRAMS: AN EMPIRICAL INVESTIGATION FOR GERMANY

For Germany, we estimate the relative effectiveness of training programs and job creation schemes. We pay particular attention to problems of common support that may arise in cross-program comparisons. Furthermore, we show that the use of different outcome variables may lead to different conclusions. In particular, the group of participants in job creation schemes may be too different from training participants to conduct a reliable comparison. Participants in shorter training programs spend more time in employment than those in longer programs; this is mainly due to less lock-in effects. However, at the end of our observation period participants in long retraining programs show the best relative performance.