Tina Haussen (p), Marcus Schlegel

Donald Houston

Active Labor Market Policies, like the promotion of self-employment among unemployed persons, are broadly discussed instruments to improve the employment situation in Europe. Whether the measures implemented work is, however, uncertain. We contribute to already completed participant evaluations by conducting a macroeconomic approach, investigating unique data of participants of two distinctive start-up subsidies in Thuringia, a federal state of Germany. The implemented stock-flow matching function finds only limited evidence that start-up subsidies help to reduce unemployment at the regional perspective. It is demonstrated that direct employment effects largely depend on the supported target groups and their prior endowment of human and financial capital. In particular for the long-term unemployed with a lower endowment of human and financial capital these results give new indications about counteracting market distortion. Conclusions for reasonable policy implications are discussed.

Emma Lappi (p)

Donald Houston

This paper studies whether new hires of individuals with self-employment experience enhance the productivity of firms. Since we use register-based matched employee-employer data, we can track the previous labor market experiences the employees have obtained before their current employment and aggregate the information for the firm-level. We are interested in the type of the previous self-employment spells of the newly hired and distinguish whether the individual employed others during their experience or were own account workers and whether the experience is from the same industry as the subsequent employment. We evaluate whether the hiring of previously self-employed will influence the labor productivity of firms separately for small and larger firms for the time period of 2003 to 2015 for the service sector in Sweden. We find that the effects differ according to the experience type as well as firm size. In general, the productivity effects can be found only for small firms while there is little evidence of the previously self-employed to impact productivity in larger firms. In addition, we disentangle the skill levels of the newly hired and find them to matter for the impact of the newly hired previously self-employed

Eduardo Ibarra-Olivo (p)

Donald Houston

Inward Foreign Direct Investment (IFDI) has been often considered to play a prominent role in the development of human capital in the host economy. By providing attractive employment opportunities, foreign presence may incentivise students to acquire further formal education, via the adjustment of the relative returns to education. However, the effect of foreign presence on educational attainment can act in the opposite direction if the IFDI-induced returns to education do not compensate opportunity cost of schooling, pushing youths to dropout of secondary education. This paper combines data on educational attainment of young cohorts spanning over a period of 20 years with IFDI, employment and wage data. To investigate this relationship for the Mexican case, we construct several datasets to measure the effect of new foreign jobs and foreign wage premia on the enrolment rates and years of education of young cohorts that were 15 years old at the time of foreign jobs arrival in their municipio of residence. The results herein suggest that new highly-paid foreign unskilled jobs have negative effects on a cohort’s subsequent enrolment rates and individual probability of school attendance, both for services and manufacturing. Contrarily, the effects of foreign wage premium for skilled workers, might lead to positive educational outcomes. The labour market effects of foreign entry are long lasting and result in lower educational attainment years later.