What's New at IZA

Klaus F. Zimmermann, CEO and Director of IZA and President of the German Institute for Economic Research (DIW Berlin), was re-elected for another three years as Director of the Executive Board of the Association of German Economic Research Institutes (ARGE) on April 17, 2008. Among the other board members are IZA Policy Fellows Thomas Straubhaar (HWWI) and Johann Eekhoff (University of Cologne), as well as Ulrich Blum (IWH), Wolfgang Franz (ZEW), and Hans-Werner Sinn (ifo). Established in 1949, ARGE is the umbrella organization of 30 German economic research institutes. "Given the multitude of economic challenges ahead, it is important that the institutes keep pushing for sustainable economic policies. ARGE provides an excellent platform for this purpose," said Zimmermannn after his re-election.

In May 2008, the "Commission on the Future of NRW" will take up its task to advise the state government of North-Rhine Westphalia on education, economic and labor market policy with a particular focus on questions of solidarity in an aging society. Established by the state's prime minister Jürgen Rüttgers, the independent commission will prepare a report on "NRW 2025 – Innovation, Employment, Quality of Life" with recommendations to achieve these goals. The state government intends to incorporate this advice in next year's agenda and discuss the issues at an annual Europe-wide congress on the living conditions of future generations. Among the 23 members of the commission representing various areas of society, IZA Director Klaus F. Zimmermann will coordinate the activities in the areas of economy and labor.

For further information see the NRW press release (in German).

A recent IZA Discussion Paper finds that the ERASMUS program of the European Union has been very effective in terms of increasing labor market mobility within Europe. The results indicate that participation in ERASMUS has increased the probability of working abroad later by up to 20 percentage points. The policy also seems to foster the goal of an integrate EU labor market: Of those who opt for a career abroad, two-third end up working in a European country.

M. Parey/F. Waldinger, Studying Abroad and the Effect on International Labor Market Mobility: Evidence from the Introduction of ERASMUS. IZA Discussion Paper No. 3430.

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In a joint declaration published in today's issue of the German business daily Handelsblatt, the leaders of Germany's top economic research institutes - including IZA CEO and Director Klaus F. Zimmermann - strongly advised policymakers against the introduction of a legal minimum wage across industries. The implementation of recent plans by the Federal Ministry of Labor would erode the collective bargaining process and undermine the foundation of Germany's successful market economy principle, warned the economists. Apart from its negative employment effects, the planned minimum wage would be unsuitable as a redistributive instrument and therefore inefficient from a social policy perspective.

The complete text of the declaration is available in Germany language only.

A. Constant, K. F. Zimmermann, R. Süssmuth, M. Kahanec

On March 12, IZA CEO and Director Klaus F. Zimmermann and IZA Senior Research Associates Martin Kahanec and Amelie Constant (also DIW DC and Georgetown University) presented a recent IZA study on the shortcomings in the social and economic integration of ethnic minorities in the EU. Based on this extended EU-wide survey, a "High Level Group", commissioned by the European Commission, has published a comprehensive report containing policy recommendations for European and national integration policies. During this Berlin Lunchtime Meeting, Rita Süssmuth (President, High Level Group) presented the group's report and discussed the topic of better social and labor market integration of ethnic minorities with the IZA experts.

Further reading:
- IZA Press Statement (in German)
- IZA Study on the Social and Labour Market Integration of Ethnic Minorities
- Report of the High Level Group: "An Urgent Call for Better Inclusion"

K. F. Zimmermannn, M. Frölich

IZA Research Fellow Markus Frölich (University of Mannheim) has joined Robert Holzmann (World Bank) as Program Director for the IZA Program Area "Employment and Development" in March 2008. He is taking over from IZA Director Klaus F. Zimmermann, who had acted as interim program director after launching the cooperation with the World Bank in 2006.

Markus Frölich has been Full Professor of Econometrics at the University of Mannheim since January 2008. He received his Ph.D. from the University of St. Gallen in October 2002 for his thesis on "Programme Evaluation and Treatment Choice." After visiting University College London as a Marie Curie Individual Fellow, he became Assistant Professor at the University of St. Gallen. In addition to development economics and evaluation, his research interests include the economics of education. Zimmermann welcomed Frölich's decision to coordinate IZA's activities in the field of employment and development: "Markus Frölich is a young, dynamic researcher who has cooperated with IZA for quite some time. He will certainly contribute a great deal to advancing this important research area together with Robert Holzmann."