Hillmann, Katja (2009): Does the Hartz IV Reform have an Effect on Matching Efficiency in Germany? A Stochastic Frontier Approach.
Download (187Kb) | Preview
In the course of a comprehensive labor market reform started in 2002 and finished through the implementation of the most radical measure Hartz IV in 2005, I exploit its impact on matching processes in Germany. I use disaggregated data for 178 local employment agencies to examine the effects of stocks and flows of vacancies and unemployed on the hiring rate as well as on the matching efficiency. Building on the work of Ibourk et al. (2004) and Fahr and Sunde (2006), I employ a stochastic frontier analysis. As a functional framework I choose the translog function to address the interactions of stocks and flows in generating new hires. Furthermore, the twofold structure of a stochastic frontier allows for a modeling of potential sources (e.g. Hartz IV) expected to induce an increased or decreased matching efficiency. My results suggest that Hartz IV exhibits a significantly positive impact on the hiring rate and the matching efficiency. Compared to 1998, on average matching efficiency experienced an increase in 2007.
|Item Type:||MPRA Paper|
|Original Title:||Does the Hartz IV Reform have an Effect on Matching Efficiency in Germany? A Stochastic Frontier Approach|
|Keywords:||Labor Market Reform, Matching Models, Stochastic Frontier Analysis, Germany|
|Subjects:||C - Mathematical and Quantitative Methods > C2 - Single Equation Models; Single Variables > C23 - Models with Panel Data; Longitudinal Data; Spatial Time Series
J - Labor and Demographic Economics > J6 - Mobility, Unemployment, and Vacancies > J64 - Unemployment: Models, Duration, Incidence, and Job Search
C - Mathematical and Quantitative Methods > C2 - Single Equation Models; Single Variables > C24 - Truncated and Censored Models; Switching Regression Models
J - Labor and Demographic Economics > J6 - Mobility, Unemployment, and Vacancies > J68 - Public Policy
|Depositing User:||Katja Hillmann|
|Date Deposited:||25. Apr 2010 02:04|
|Last Modified:||13. Feb 2013 19:51|
Aigner, D., Lovell, C. A. K., Schmidt, P., July 1977. Formulation and estimation of stochastic frontier production function models. Journal of Econometrics 6 (1), 21–37.
Battese, G. E., Coelli, T. J., 1995. A model for technical inefficiency effects in a stochastic frontier production function for panel data. Empirical Economics 20 (2), 325–32.
Berndt, E. R., Christensen, L. R., March 1973. The translog function and the substitution of equipment, structures, and labor in u.s. manufacturing 1929-68. Journal of Econometrics 1 (1), 81–113.
Chen, Y. H., Lin, W. T., 2009. Analyzing the relationship between information technology, inputs substitution and national characteristics based on ces stochastic production models. International Journal of Production Economics (In press), http://dx.doi.org/10.1016/j.ijpe.2008.07.034.
Coles, M. G., Petrongolo, B., 2008. A test between stock-flow matching and the random matching function approach. International Economic Review 49 (4), 1113–1141.
Coles, M. G., Smith, E., November 1996. Cross-section estimation of the matching function: Evidence from england and wales. Economica 63 (252), 589–97.
Coles, M. G., Smith, E., Feb 1998. Marketplaces and matching. International Economic Review 39 (1), 239–254.
Fahr, R., Sunde, U., June 2006. Regional dependencies in job creation: An efficiency analysis for western germany. Applied Economics 38 (10), 1193–1206.
Fahr, R., Sunde, U., Aug 2009. Did the hartz reforms speed-up the matching process? a macroevaluation using empirical matching functions. German Economic Review 10, 284–316.
Gregg, P., Petrongolo, B., November 2005. Stock-flow matching and the performance of the labor market. European Economic Review 49 (8), 1987–2011.
Hynninen, S.-M., Feb 2009. Matching in local labor markets: a stochastic frontier approach. Journal of Productivity Analysis 31 (1), 15–26.
Ibourk, A., Maillard, B., Perelman, S., Sneessens, H., March 2004. Aggregate matching efficiency: A stochastic production frontier approach, france 1990-1994. Empirica 31 (1), 1–25.
Jacobi, L., Kluve, J., Apr. 2006. Before and after the hartz reforms: The performance of active labour market policy in germany. IZA Discussion Papers 2100, Institute for the Study of Labor (IZA).
Munich, D., Svejnar, J., Terrell, K., 1998. The worker-firm matching in transition economies: (why) are the czechs more successful than others? Working Paper 107, The William Davidson Institute.
Warren, R. J., January 1996. Returns to scale in a matching model of the labor market. Economics Letters 50 (1), 135–142.
Yashiv, E., December 2000. The determinants of equilibrium unemployment. American Economic Review 90 (5), 1297–1322.