Scandinavian Working Papers in Economics

Working Paper Series,
IFAU - Institute for Evaluation of Labour Market and Education Policy

No 2011:4: The threat effect of participation in active labor market programs on job search behavior of migrants in Germany

Annette Bergemann (), Marco Caliendo , Gerard J. van den Berg and Klaus F. Zimmermann
Additional contact information
Annette Bergemann: Department of Economics, University of Mannheimn, Postal: L7, 3-5, 68131 Mannheim, Germany
Marco Caliendo: DIW Berlin
Gerard J. van den Berg: IFAU - Institute forLabour Market Policy Evaluation, Postal: P O Box 513, SE-751 20 Uppsala, Sweden
Klaus F. Zimmermann: University of Bonn

Abstract: Labor market programs may affect unemployed individuals’ behavior before they enroll. Such ex ante effects may differ according to ethnic origin. We apply a novel method that relates self-reported perceived treatment rates and job search behav­ioral outcomes, such as the reservation wage or search intensity, to each other. We compare German native workers with migrants with a Turkish origin or Central and Eastern European (including Russian) background. Job search theory is used to de­rive theoretical predictions. We examine the omnibus ex ante effect of the German ALMP system, using the novel IZA Evaluation Data Set, which includes self-reported assessments of the variables of interest as well as an unusually detailed amount of in­formation on behavior, attitudes and past outcomes. We find that the ex ante threat effect on the reservation wage and search effort varies considerably among the groups considered.

Keywords: Immigrants; policy evaluation; reservation wage; search effort; expectations; unemploy­ment duration; program evaluation; active labor market policy.

JEL-codes: C21; D83; D84; J61; J64

22 pages, February 7, 2011

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