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School to Work Transitions and the Impact of Public Expenditure on Education

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Author Info
Maite Blázquez
José Ignacio García Pérez

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Abstract

In this paper we analyse how the decentralization process of the Spanish educational system has affected the school-to-work transition of youths over the last years. Using individual data from the Spanish Labor Force Survey for the period 1993-2002, we estimate a simultaneous equation model for the unemployment and employment hazard rates of these workers. We include public expenditure on education, at the regional level, as an explanatory factor in both hazards. Furthermore we account for cross-regional differences regarding the decision-making authority over education. Our results reveal that for both, university and non-university levels, public expenditure on education significantly improves the chances of Spanish youths in finding the first job after completing the educational system. However, it seems that the decentralization of university education has negative effects on youths’ labor market prospects in terms of exiting from unemployment, while no effects are observed for the case of non-university education.

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Paper provided by FEDEA in its series Working Papers with number 2007-13.

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Date of creation: May 2007
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Handle: RePEc:fda:fdaddt:2007-13

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  1. Paul Ryan, 2001. "The School-to-Work Transition: A Cross-National Perspective," Journal of Economic Literature, American Economic Association, vol. 39(1), pages 34-92, March. [Downloadable!] (restricted)
  2. Jenkins, Stephen P, 1995. "Easy Estimation Methods for Discrete-Time Duration Models," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 57(1), pages 129-38, February.
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