Observed and unobserved determinants of unemployment insurance benefit sanctions in Germany: Evidence from matched individual and regional administrative data

The paper analyzes the individual and regional determinants of unemployment benefit sanctions in Germany. On the basis of an administrative data set a multilevel hazard rate model in discrete time for the transitions into a sanction is estimated, controlling for unobserved heterogeneity on the individual and regional level. It is shown that certain benefit recipients, e.g. younger people, are more likely to receive sanctions than e.g. older, disabled, or skilled individuals. Moreover, the risk of being sanctioned not only depends on individual characteristics but is also influenced by the sanction policies of the employment agencies.