Active Labour Market Policies in Denmark : A Comparative Analysis of Post-Program Effects

The scope of the paper is to estimate post-program effects in fostering good transitions from unemployment to work. Such an issue implies that besides job finding rates, qualitative variables related to work have to be included as well. The evaluation is based on a comprehensive transversal dataset of Danes who ended an activation program in the year 2002, merged with individual characteristics and yearly information related to their labour market status until 2004. To control for unobserved heterogeneity treatment-effects models have been applied. As regards transitions to work and labour market integration, main results show fairly large positive effects for private sector employment programs. It is worthwhile to be aware that job opportunities for private sector employment participants are highly dependent on the business cycle. Besides, the "creaming effects" minimize the positive impact of this type of programs as unemployed with longer work experience benefit the most from the private sector. Smaller positive impacts are found for labour market training and intensive job seeking, whereas negative coefficients are assigned to public sector employment programs. Long-term effects on wages are the most positive for those who involved into labour market training.