Research

Working Papers

JMP - This paper was awarded the SSES Young Economist Award under the title "Peer effects in active labour market policies".

This paper shows that the group composition matters for the effectiveness of labor market training programs for jobseekers. Using rich administrative data from Germany, I document that greater average exposure to highly employable peers leads to increased employment stability after program participation. Peer effects on earnings are positive and long-lasting in classic vocational training and negative but of short duration in retraining, pointing to different mechanisms. Finally, I also find evidence for non-linearities in effects and show that more heterogeneity in the peer group is detrimental.

Macroeconomic Effects of Active Labour Market Policies: A Novel Instrumental Variables Approach (with Conny Wunsch)

This study evaluates the macroeconomic effects of active labour market policies in Germany over the period 2005 to 2018. We propose a novel identification strategy that exploits the imperfect overlap of local labour markets and local employment agencies that decide on the local implementation of policies. Specifically, we instrument for the use of policies in a local labour market with the mix of policies implemented outside this market but in local employment agencies that partially overlap with this market. We find no effects of short-term activation measures and further vocational training on aggregate labour market outcomes. In contrast, wage subsidies substantially increase the share of workers in unsubsidised employment, while lowering long-term unemployment and welfare dependency. Overall, the results point at negative externalities of active labour market policies that partially offset the effects for program participants and that some segments of the labour market benefit more than others.

Hours Mismatch and Income Tax Incentives for Low- Earning Workers (with Vera Zabrodina) - draft available upon request

Many workers do not work their desired number of hours, particularly in the low-earning segment. We study whether income tax notches generate hours mismatch in the context of mini jobs in Germany. These jobs are exempt from income and social security taxes up until a salient earnings threshold. We find substantial underemployment at the threshold, suggesting that it constrains many workers to work less than their optimum. A reform shifting the threshold upwards raised underemployment among mini jobbers. Workers increased their desired hours, but contracts adjusted through small increases in actual hours and wages. These findings are consistent with firms' hours constraints shaping job offers in the low-earning segment. They suggest that firms cater to workers' incentives to bunch, but overprovide mini jobs. While workers are able to achieve higher earnings in the adjustment, the aggravation in underemployment points to ambiguous effects on worker welfare.

Fathers, Parental Leave and Gender Norms, IZA Discussion Paper No. 10712 , 2017 (with Katharina Wrohlich).

Work in Progress

The Performance of Estimators for Causal Mediation Analysis in Double Randomization Designs (with Renate Strobl, Conny Wunsch and M.H. Clark)

This paper surveys estimators applied in causal mediation analysis by the strictness of the assumptions they impose and evaluates their finite sample performance. We focus on so-called double randomization designs where a first experiment randomly assigns the treatment and a second randomizes the mediator within the sub-population of the treated. This setting allows us to identify direct and indirect effects under sequential ignorability but also under the weaker assumption of conditional homogeneity of the mediator effect. We compare the estimators in a Monte Carlo simulation and in three experimental datasets. Two of the experiments directly elicit counterfactual mediator values, and thus provide an (assumption-free) benchmark to which the estimators can be compared.

Policy Reports

Das Elterngeld hat soziale Normen verändert, DIW-Wochenbericht No. 34 , 2017 (with Katharina Wrohlich and Clara Welteke)