Hybrid Archive - IAB - Institut für Arbeitsmarkt- und Berufsforschung

Is Remote Work Attractive for Women Living in Peripheral Areas? A Survey-Based Experiment in Six EU Countries

This study is the first to explore the extent of job offers with remote work options.

Promoting remote work among women living in peripheral areas is a potential tool to limit gender and geographical imbalances in the labour market. This study is the first to explore the extent to which women living in peripheral municipalities (compared with those from metropolitan ones) are attracted to job offers with remote work options.

The study is based on a CAWI survey with a conjoint experiment conducted in Spring 2026 among 3,785 prime-aged women living in France, Italy, the Netherlands, Poland, Romania, and Sweden.

The initial results indicate that, on average, fully remote work (compared to fully on-site work) increases the probability of accepting a job offer to the same degree in both metropolises and peripheral municipalities, by around 14 percentage points. What is relevant, remote work remains attractive for peripheral respondents with lower than higher education, as well as for those with poor digital skills.

Employment Protection, Worker Mobility, and Endogenous Growth

This study characterizes optimal labor-market policy in a multi-sector economy.

This study characterizes optimal labor-market policy in a multi-sector economy that joins endogenous growth, frictional worker reallocation, and human-capital accumulation on an input–output network.

Our growth engine is portable human capital: within-match training lifts the economy’s growth frontier, but because trained skill is carried into unemployment and priced in the worker’s outside option, it compresses the bilateral surplus that funds job creation. In contrast to productivity differences across sectors differences in growth potential push labor out of the higher-growth sector. The model speaks at once to the human-capital and diffusion theory of growth and the recent growth-through reallocation literature. To correct for worker-stealing and incumbent-match externalities - similar to those in Fukui and Mukoyama, 2025 in a growth context - the social planner needs to use a complex system of hiring, firing, training, on the-job search, unemployed switching, and schooling taxes/subsidies that we characterize.

We find that if on-the-job search merely reshuffles workers the planner subsidizes separations and taxes hiring; when mobility instead builds portable skill, the prescriptions reverse. The framework delivers a unified, network-aware account of when worker mobility is socially valuable and how employment-protection policy might respond in a theory of second best.

How did you find your job? Effects of the job search channels on labour market outcomes in Germany

This study is about the effect of finding a job through one’s social contact on starting wages.

This study is about the effect of finding a job through one’s social contact on starting wages. Using combined SOEP-INKAR data for Germany and propensity score analysis - both matching and weighting - we document that referral hiring is associated with a wage penalty of 10%. This penalty is stable over time. Separating by the type of the social contact, we find that referrals from former colleagues are associated with a 9% wage premium compared to a direct formal application. In contrast, referrals from friends are associated with a 7% wage penalty.

Our results highlight persistent self-selection of workers on observable and unobservable characteristics. Using information from a short test of cognitive abilities (symbol digit test) we document that workers recommended by former colleagues perform best in the ability test, consistent with the predictions from a sorting model. The lowest performance is recorded for those relying on the help of their friends. The effects are primarily driven by the sub-sample of women. No significant differences across search channels are found for personality traits.

The (Missing) Third Pillar – Why climate policy needs to get serious about planetary waste management

This study examines why large-scale carbon dioxide removal (CDR) is essential for meeting climate targets.

Professor Ottmar Edenhofer examines why large-scale carbon dioxide removal (CDR) is essential for meeting climate targets and establishing a third pillar of climate policy alongside abatement and adaptation.

Even with rapid innovation, projected levels of carbon dioxide removal (CDR) remain far below what is required to stay within internationally agreed temperature limits. The main barriers to technology development and deployment are institutional, economic, and political – reflected in governance gaps that undermine incentives to invest in and deploy CDR at scale. He presents market and governance solutions, including innovative “clean-up certificates” and a European Carbon Central Bank to manage net-negative emissions within carbon market frameworks. By “cleaning up” the atmosphere, CDR can also help reduce free-riding incentives in international climate co-operation.

Professor Edenhofer identifies planetary carbon management as the central challenge of 21st-century climate policy, a necessary third pillar of climate policy, alongside emissions reduction and adaptation, and as a critical enabler of net-zero and net-negative pathways.

Caught in the Storm? Financial Conditions and Employment Decline in German Manufacturing Industry

This paper examines whether tighter financial conditions contributed to this development.

Since 2022, manufacturing employment in Germany has declined markedly, even as overall employment remained stable. This paper examines whether tighter financial conditions contributed to this development. Using pre-pandemic sectoral leverage as a measure of financial exposure, we show that highly leveraged manufacturing sectors experienced significantly larger employment declines following the sharp increase in euro area interest rates. The decline is particularly high for capital intensive manufacturing sectors and robust to controls for energy intensity and preexisting trends. The findings suggest that financial leverage amplified the impact of monetary tightening on manufacturing employment.

Joint work with Enzo Weber.

Breaking Barriers or Reinforcing Inequalities? The Impact of Affordable Childcare on Entrepreneurship

This study exploits exogenous variation in the pricing of childcare caused by a nationwide reform.

We exploit exogenous variation in the pricing of childcare caused by a nationwide reform to estimate the impact of lower childcare costs and the propensity of individuals to start a firm. The reform capped the childcare prices, whereas the exogenous variation in the reduction of childcare prices comes from the pre-reform prices, which depended on the place of residence and family type. Decreasing the cost of childcare lowers both the capital and time constraint, which can lead to individuals becoming entrepreneurs.

We evaluate such potential mechanisms both for males and females separately in a difference-in-difference setting up to 5 years post reform. We find that reducing childcare costs increases entrepreneurial activity for both mothers and fathers.

Trade Integration, Import Competition, and Optimal Unemployment Insurance

This paper investigates the optimal design and implementation of labor market institutions within an open economy framework.

This paper investigates the optimal design and implementation of labor market institutions within an open economy framework. We develop a Heterogeneous Agent New Keynesian (HANK) DSGE model featuring search and matching frictions to analyze the interaction between labor market flexibility and international trade, with a specific focus on the German experience. Our findings suggest that labor market institutions, when analyzed in isolation, have a marginal impact on aggregate unemployment and welfare. However, their efficacy is significantly amplified when an economy is exposed to international trade.

We show that while import competition exerts upward pressure on unemployment in the short run, more flexible labor market institutions are essential for maximizing welfare in the long run. Crucially, we study the optimal policy sequence and find that a stepwise, sequential implementation of reforms is superior to a "big bang" approach. Such a trajectory maximizes aggregate welfare over a longer time horizon by effectively shielding heterogeneous agents from the regressive distributive effects of globalization shocks during the transition phase. Our results provide a normative rationale for gradualism in structural reform agendas within integrated economies.

Joint work with Andreas Hauptmann (IAB) and Benjamin Schwanebeck (FernUniversität in Hagen).

Spatial income inequality in Germany, 1957-2021

This study is about income inequality between and within German regions from 1957 to 2021 using a newly collected panel.

We analyze income inequality between and within German regions from 1957 to 2021 using a newly collected panel. We confirm previous evidence on convergence between regions during the decades after World War II, but do not find pronounced regional divergence since the 1990s - in contrast to some earlier studies.

Instead, the national income inequality rise since the 1980s is closely tracked by the near-unanimous rise in income concentration within regions, driven by overproportional labor income growth of the top income decile. Regression analysis suggests that regional growth switched from equality-enhancing to inequality-increasing in the 1990s.

Valuing Non-Wage Amenities: Survey and Experimental Evidence from Army Enlistments

In this paper, we estimate willingness to pay (WTP) across two key amenities in the U.S. Army.

Survey-based discrete choice experiments are widely used to estimate willingness to pay (WTP) for non-wage amenities. Recent innovations in elicitation methods, such as Bayesian Adaptive Choice Experiments (BACE), can generate precise, individualized WTP estimates, making possible a more stringent field test of survey-based discrete choice methods against person-level realized choices.

In this paper, we estimate WTP across two key amenities in the U.S. Army: (i) the compensation recruits require to accept longer initial service obligations, and (ii) recruits’ willingness to pay for a first duty station of their choosing. We implement two complementary approaches. First, we conduct a randomized controlled trial (RCT) that randomizes enlistment bonuses across these amenities, allowing us to estimate WTP for station of choice and for extending recruits’ contractually obligated service from 3 years to 4, 5, and 6 years. Second, we administer a BACE survey to a sample of potential recruits—nearly half of whom subsequently enlist—to estimate the same parameters. We compare estimates across the RCT and survey-based approaches, examining both internal consistency within the survey and external consistency with real-world enlistment choices.

Together, these analyses provide a field test of survey-based valuation methods and suggest that targeted changes to Army enlistment incentive structures could yield substantial cost savings.

Joint: Michael T. Baker, Kyle Greenberg, and Linh Tô