Broken Hierarchies, Quasi‐markets and Supported Networks – A Governance Experiment in the Second Tier of G ermany's Public Employment Service

• Published in: Social policy & administration 2014-04, Vol.48 (2), p.240-261
• Main Author: Knuth, Matthias
• Format: Article
• Language: English
• ISSN: 0144-5596; 1467-9515
• DOI: 10.1111/spol.12059

From 2005 to 2015, the German government implemented a special programme for jobseekers aged 50 plus and receiving minimum income benefits. Descriptive comparisons and econometric evaluation indicate that this programme was more effective and cost‐efficient than the German jobcentres' standard operations. However, our evaluation did not ascertain any particular instrument or technique which would explain this accomplishment. Rather, the formula for success appears to be hidden in the governance and design of the programme which differed markedly from routine support. Network‐type governance mechanisms as applied in this programme appear to have served as an expedient in circumstances where hierarchical steering is no longer feasible. This article explains how the governance dilemma of the German Public Employment Service's ‘second tier’ (serving recipients of minimum income benefits) probably triggered the innovative approach so successfully pursued in the programme under consideration. The analysis is concluded by proposing some conceptual clarifications for the long‐standing debate about hierarchies/bureaucracies, markets and networks in the governance of welfare programmes.