Is Germany the North Star of Labor Market Policy?

31 Pages Posted: 16 Mar 2013 Last revised: 16 Apr 2023

See all articles by Ulf Rinne

Ulf Rinne

IZA Institute of Labor Economics

Klaus F. Zimmermann

Global Labor Organization (GLO); UNU-MERIT; Maastricht University, Department of Economics; Free University Berlin; University of Bonn; Centre for Economic Policy Research (CEPR); Journal of Population Economics

Abstract

Germany's recovery from an unemployment disease and its resilience to the Great Recession is remarkable. Its success story makes it a showcase for labor policy and labor market reforms. This paper assesses the potential of the German experience as a model for effective, evidence-based policymaking. Flexible management of working time (through overtime and short-time work, time accounts and labor hoarding), social cohesion and controlled unit labor costs, combined with a rigid, incentive-oriented labor policy supported by effective program evaluation, define the characteristics of a strong reference model. Austerity, sometimes seen as core to the German model, is not viewed as a key element.

Keywords: unemployment, Great Recession, austerity, Germany, labor policy, labor market reforms

JEL Classification: J68, J21, P52, O57

Suggested Citation

Rinne, Ulf and Zimmermann, Klaus F., Is Germany the North Star of Labor Market Policy?. IZA Discussion Paper No. 7260, Available at SSRN: https://ssrn.com/abstract=2234322 or http://dx.doi.org/10.2139/ssrn.2234322

Ulf Rinne (Contact Author)

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

HOME PAGE: http://www.iza.org/profile?key=1844

Klaus F. Zimmermann

Global Labor Organization (GLO) ( email )

Bonn
Germany

HOME PAGE: http://https://glabor.org/

UNU-MERIT ( email )

Keizer Karelplein 19
Maastricht, 6211TC
Netherlands

Maastricht University, Department of Economics ( email )

P.O. Box 616
Maastricht, Limburg 6200MD
Netherlands

University of Bonn

Postfach 2220
Bonn, D-53012
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Journal of Population Economics

Tiergartenstr. 17
D-69121 Heidelberg
Germany

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
58
Abstract Views
583
Rank
651,013
PlumX Metrics