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Should We Teach Old Dogs New Tricks? The Impact of Community College Retraining on Older Displaced Workers

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Author Info
Robert LaLonde
Abstract

This paper estimates the returns to retraining for older displaced workers—those 35 or older—by estimating the impact of community college schooling on earnings. Our analysis relies on longitudinal administrative records covering workers displaced from jobs in Washington State during the early 1990s. We find older displaced workers participate in community college schooling at lower rates than younger workers. But, among those who participate, the impact on quarterly earnings for older and younger displaced workers is similar. We estimate one academic year of community college schooling increases long-term earnings by about 7 percent for older males and by about 10 percent for older females. Although these percentages are consistent with those reported in the schooling literature, estimates of the social internal rates of return from this retraining may differ significantly among older and younger workers because of differences in their work lives and their opportunity costs of retraining.

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Paper provided by Harris School of Public Policy Studies, University of Chicago in its series Working Papers with number 0412.

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Date of creation: Jul 2004
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Handle: RePEc:har:wpaper:0412

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Related research
Keywords: Washington state; retraining; displaced workers; community college; economic returns; social returns;

References listed on IDEAS
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  1. Heckman, J.J. & Hotz, V.J., 1988. "Choosing Among Alternative Nonexperimental Methods For Estimating The Impact Of Social Programs: The Case Of Manpower Training," University of Chicago - Economics Research Center 88-12, Chicago - Economics Research Center.
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  2. Janet Currie, 2001. "Early Childhood Education Programs," Journal of Economic Perspectives, American Economic Association, vol. 15(2), pages 213-238, Spring. [Downloadable!] (restricted)
  3. James Heckman & Hidehiko Ichimura & Jeffrey Smith & Petra Todd, 1998. "Characterizing Selection Bias Using Experimental Data," Econometrica, Econometric Society, vol. 66(5), pages 1017-1098, September.
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  4. Ruhm, Christopher J, 1991. "Are Workers Permanently Scarred by Job Displacements?," American Economic Review, American Economic Association, vol. 81(1), pages 319-24, March. [Downloadable!] (restricted)
  5. Aakvik, Arild & Heckman, James J. & Vytlacil, Edward J., 2005. "Estimating treatment effects for discrete outcomes when responses to treatment vary: an application to Norwegian vocational rehabilitation programs," Journal of Econometrics, Elsevier, vol. 125(1-2), pages 15-51. [Downloadable!] (restricted)
  6. Eliana Garces & Duncan Thomas & Janet Currie, 2002. "Longer-Term Effects of Head Start," American Economic Review, American Economic Association, vol. 92(4), pages 999-1012, September. [Downloadable!]
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  7. Carneiro, Pedro & Heckman, James J., 2003. "Human Capital Policy," IZA Discussion Papers 821, Institute for the Study of Labor (IZA). [Downloadable!]
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  8. Henry S. Farber, 2003. "Job Loss in the United States, 1981-2001," Working Papers 113, Princeton University, Department of Economics, Center for Economic Policy Studies.. [Downloadable!]
  9. Thomas J. Kane & Cecilia Elena Rouse, 1999. "The Community College: Educating Students at the Margin between College and Work," Journal of Economic Perspectives, American Economic Association, vol. 13(1), pages 63-84, Winter. [Downloadable!] (restricted)
  10. James J. Heckman & Lance J. Lochner & Petra E. Todd, 2003. "Fifty Years of Mincer Earnings Regressions," NBER Working Papers 9732, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  11. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier. [Downloadable!] (restricted)
  12. Jacobson, Louis S & LaLonde, Robert J & Sullivan, Daniel G, 1993. "Earnings Losses of Displaced Workers," American Economic Review, American Economic Association, vol. 83(4), pages 685-709, September. [Downloadable!] (restricted)
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  13. Henry S. Farber, 2003. "Job Loss in the United States, 1981-2001," Working Papers 850, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
  14. Robert J. LaLonde, 2003. "Employment and Training Programs," NBER Chapters, in: Means-Tested Transfer Programs in the United States, pages 517-586 National Bureau of Economic Research, Inc. [Downloadable!]
  15. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier. [Downloadable!] (restricted)
  16. Henry Farber, 2003. "Job Loss in the United States, 1981-2001," NBER Working Papers 9707, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  17. Ashenfelter, Orley C, 1978. "Estimating the Effect of Training Programs on Earnings," The Review of Economics and Statistics, MIT Press, vol. 60(1), pages 47-57, February. [Downloadable!] (restricted)
  18. Ashenfelter, Orley & Card, David, 1985. "Using the Longitudinal Structure of Earnings to Estimate the Effect of Training Programs," The Review of Economics and Statistics, MIT Press, vol. 67(4), pages 648-60, November. [Downloadable!] (restricted)
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