his paper examines the effectiveness of ALMPs in i
mproving labour market outcomes, especially for
low-skilled individuals. Much has been written abou
t the effectiveness of activation measures based
on evaluations carried out using micro data, yet no
t enough about their effectiveness at the aggregate
level. This is particularly true with regards to th
e role of ALMPs’ implementation characteristics in
shaping their overall effects. This paper aims to c
ontribute to this debate through an aggregate impac
t
approach which is better placed to measure both, th
e direct and indirect effects of ALMPs. It finds
that ALMPs matter at the aggregate level. Training,
employment incentives, supported employment
and direct job creation measures show the most favo
urable results, both in terms of reducing
unemployment, but also in terms of increasing emplo
yment and participation. Spending in start-up
incentives is more effective but only in terms of r
educing the unemployment rate. Importantly, results
show that ALMPs are more effective for the low skil
led than for the overall population. In terms of
implementation, the analysis finds that the most fa
vourable aspect is the allocation of resources to
programme administration. Interestingly, the size o
f the coefficients arising from policy and
implementation variables, once interactions are inc
luded is noticeably higher. This demonstrates that
a
correct implementation of policies enhances their b
eneficial effect.