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Quick Job Entry or Long-Term Human Capital Development? The Dynamic Effects of Alternative Training Schemes

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  • Aderonke Osikominu

Abstract

This article investigates how precisely short-term, job search-oriented training programs as opposed to long-term, human capital intensive training programs work. We evaluate and compare their effects on time until job entry, stability of employment, and earnings. Further, we examine the heterogeneity of treatment effects according to the timing of training during unemployment as well as across different subgroups of participants. We find that participating in short-term training reduces the remaining time in unemployment and moderately increases job stability. Long-term training programs initially prolong the remaining time in unemployment, but once the scheduled program end is reached participants exit to employment at a much faster rate than without training. In addition, they benefit from substantially more stable employment spells and higher earnings. Overall, long-term training programs are well effective in supporting the occupational advancement of very heterogeneous groups of participants, including those with generally weak labor market prospects. However, from a fiscal perspective only the low-cost short-term training schemes are cost efficient in the short run. Copyright , Oxford University Press.

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Bibliographic Info

Article provided by Oxford University Press in its journal Review of Economic Studies.

Volume (Year): 80 (2013)
Issue (Month): 1 ()
Pages: 313-342

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Handle: RePEc:oup:restud:v:80:y:2013:i:1:p:313-342

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Cited by:
  1. Martin Biewen & Bernd Fitzenberger & Aderonke Osikominu & Marie Paul, 2012. "The Effectiveness of Public Sponsored Training Revisited: The Importance of Data and Methodological Choices," NRN working papers, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria 2012-09, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
  2. Fitzenberger, Bernd & Orlyanskaya, Olga & Osikominu, Aderonke & Waller, Marie, 2008. "Déjà Vu? Short-Term Training in Germany 1980–1992 and 2000–2003," IZA Discussion Papers 3540, Institute for the Study of Labor (IZA).
  3. Fairlie, Robert W. & Karlan, Dean & Zinman, Jonathan, 2014. "Behind the GATE Experiment: Evidence on Effects of and Rationales for Subsidized Entrepreneurship Training," IZA Discussion Papers 8367, Institute for the Study of Labor (IZA).
  4. Kruppe, Thomas & Lang, Julia, 2014. "Labour market effects of retraining for the unemployed : the role of occupations," IAB Discussion Paper, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] 201420, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  5. Heyer, Gerd & Koch, Susanne & Stephan, Gesine & Wolff, Joachim, 2011. "Evaluation der aktiven Arbeitsmarktpolitik: Ein Sachstandsbericht für die Instrumentenreform 2011 (Evaluation of active labor market programs : a summary of recent results for the German program refo," IAB Discussion Paper, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] 201117, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

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