 The German Labor Market Reforms and Post-Unemployment EarningsNiklas Engbom, Enrica Detragiache () and Faezeh Raei No 2015/162, IMF Working Papers from International Monetary Fund Abstract: In 2003–05, Germany undertook extensive labor market reforms which were followed by a large and persistent decline in unemployment. Key elements of the reforms were a drastic cut in benefits for the long-term unemployed and tighter job search and acceptance obligations. Using a large confidential data set from the German social security administration, we find that the reforms were associated with a fall in the earnings of workers returning to work from short-term unemployment relative to workers in long-term employment of about 10 percent. We interpret this as evidence that the reforms strengthened incentives to return to work but, in doing so, they adversely affected post re-entry earnings. Keywords: WP; Hartz reform; unemployment insurance; growth change; displaced worker; re-entry earnings; reservation wage; robustness earnings regression; Unemployment; labor market reforms; Germany; earnings worker; difference-in-difference earnings regression; post displacement; employment status; education worker; post unemployment; Wages; Unemployment benefits; Employment; Europe; Eastern Europe (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2015/162 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC. |
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