[Journal:] Zeitschrift für ArbeitsmarktForschung – Journal for Labour Market Research [ISSN:] 2510-5027 [Volume:] 42 [Year:] 2009 [Issue:] 1 [Pages:] 99-106
In his article 'The tale of the inflexible German labour market' ('Die Mär vom starren deutschen Arbeitsmarkt') in this issue of the Journal for Labour Market Research (ZAF) Werner Sengenberger criticises our introductory paper 'Potentials for flexibility in heterogeneous labour markets - an introduction', which was published in issue 2/3 of the ZAF in 2008 (Fitzenberger et al. 2008). In this reply, we comment on the accusations expressed. Our introductory paper was written as an introduction to the research programme ``Flexibility in Heterogeneous Labour Markets', which has been funded by the DFG since 2004, and refers explicitly to the status of literature on labour economics prior to 2003. This explains some of the misunderstandings and errors in Sengenberger's reception of our paper. We reject the accusations of theoretical bias and a lack of knowledge of the literature. The reply explains key developments in labour economics research and emphasises their lack of bias and preconceived conclusions. In addition the paper includes a summary of some important findings from current research in labour economics in Germany both in the context of the DFG research programme and outside it.