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Start-Up Subsidies in East Germany: Finally, a Policy that Works?
| Authors | Caliendo, M. |
| Year | 2009 |
| Reference | International Journal of Manpower, 30(7), 625-647. |
| Keywords | Start-Up Subsidies, Evaluation, Effectiveness, East Germany, Self-Employment |
| JEL-Classification | J68, M13 |
| Presentations | Workshop on Policy Evaluation, CRENOS/University of Cagliari, April 2008. |
| Download | Discussion Paper from February 2008:   PDF |
| Abstract | The German government has spent between 7bn and 11bn Euro per year
on active labor market policies (ALMP) in East Germany in the last
decade. The effectiveness of the most important programs (in terms
of participants and spending) such as job-creation schemes and
vocational training has been evaluated quite thoroughly in recent
years. The results are disappointing, indicating that nearly all of
thes "traditional" programs have to be rated as a failure. In light
of these findings, policies to encourage unemployed people to become
self-employed gained increasing importance. We present first
evidence on the effectiveness of two start-up programs in East
Germany. Our findings - even though partly preliminary - are rather
promising, showing that these programs increase employment chances
and earnings of participants. Hence, start-up subsidies might work
even in a labor market with structural problems such as the one in
East Germany. |
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