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Does the Quality of Training Programs Matter? Evidence from Bidding Processes Data

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  • Alberto Chong

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  • José Galdo

Abstract

This paper estimates the effect of training quality on labor-market earnings using a Peruvian non-experimental training program, PROJOVEN, which targets disadvantaged youths aged 16 to 24 years. The identification of causal effects is possible because of two attractive features in the data. First, the selection of training courses is based on public bidding processes that assign standardized scores to multiple proxies for quality. Second, the program`s evaluation framework allows for the identification and comparison of individuals in the treatment and comparison groups six, 12, and 18 months after the program. Using difference-in-differences kernel matching methods, we find that individuals attending high-quality training courses have higher average and marginal treatment impacts. The external validity of our estimates was assessed by using five different calls of this program over a nine-year period.

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Bibliographic Info

Paper provided by Inter-American Development Bank, Research Department in its series Research Department Publications with number 4451.

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Date of creation: Jun 2006
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Handle: RePEc:idb:wpaper:4451

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  1. Jere R. Behrman & Yingmei Cheng & Petra E. Todd, 2004. "Evaluating Preschool Programs When Length of Exposure to the Program Varies: A Nonparametric Approach," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 108-132, February.
  2. Glewwe, Paul & Kremer, Michael, 2006. "Schools, Teachers, and Education Outcomes in Developing Countries," Handbook of the Economics of Education, Elsevier, Elsevier.
  3. Marianne Bitler & Jonah Gelbach & Hilary Hoynes, 2003. "What Mean Impacts Miss: Distributional Effects of Welfare Reform Experiments," NBER Working Papers 10121, National Bureau of Economic Research, Inc.
  4. Heckman, James J & Ichimura, Hidehiko & Todd, Petra E, 1997. "Matching as an Econometric Evaluation Estimator: Evidence from Evaluating a Job Training Programme," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 64(4), pages 605-54, October.
  5. Dominic J. Brewer & Eric Eide & Ronald G. Ehrenberg, 1996. "Does It Pay To Attend An Elite Private College? Cross Cohort Evidence on the Effects of College Quality on Earnings," NBER Working Papers 5613, National Bureau of Economic Research, Inc.
  6. Eric A. Hanushek & John F. Kain & Steven G. Rivkin & Daniel M. O'Brien, 2005. "The Market for Teacher Quality," Discussion Papers, Stanford Institute for Economic Policy Research 04-025, Stanford Institute for Economic Policy Research.
  7. Jeffrey Smith & Petra Todd, 2003. "Does Matching Overcome Lalonde's Critique of Nonexperimental Estimators?," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers, University of Western Ontario, CIBC Centre for Human Capital and Productivity 20035, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
  8. James J. Heckman, 2001. "Micro Data, Heterogeneity, and the Evaluation of Public Policy: Nobel Lecture," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 109(4), pages 673-748, August.
  9. Dominic J. Brewer & Eric R. Eide & Ronald G. Ehrenberg, 1999. "Does It Pay to Attend an Elite Private College? Cross-Cohort Evidence on the Effects of College Type on Earnings," Journal of Human Resources, University of Wisconsin Press, vol. 34(1), pages 104-123.
  10. Paul Glewwe, 2002. "Schools and Skills in Developing Countries: Education Policies and Socioeconomic Outcomes," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 436-482, June.
  11. Behrman, Jere R & Birdsall, Nancy, 1983. "The Quality of Schooling: Quantity Alone is Misleading," American Economic Review, American Economic Association, vol. 73(5), pages 928-46, December.
  12. David Card & Alan Krueger, 1990. "Does School Quality Matter? Returns to Education and the Characteristics of Public Schools in the United States," NBER Working Papers 3358, National Bureau of Economic Research, Inc.
  13. Stacy Berg Dale & Alan B. Krueger, 1999. "Estimating the Payoff to Attending a More Selective College: An Application of Selection on Observables and Unobservables," NBER Working Papers 7322, National Bureau of Economic Research, Inc.
  14. Black, Dan A. & Smith, J.A.Jeffrey A., 2004. "How robust is the evidence on the effects of college quality? Evidence from matching," Journal of Econometrics, Elsevier, Elsevier, vol. 121(1-2), pages 99-124.
  15. Rajeev H. Dehejia & Sadek Wahba, 1998. "Causal Effects in Non-Experimental Studies: Re-Evaluating the Evaluation of Training Programs," NBER Working Papers 6586, National Bureau of Economic Research, Inc.
  16. Jose C. GALDO & Jeffrey SMITH & Dan BLACK, 2008. "Bandwidth Selection and the Estimation of Treatment Effects with Unbalanced Data," Annales d'Economie et de Statistique, ENSAE, issue 91-92, pages 189-216.
  17. James Heckman & Hidehiko Ichimura & Jeffrey Smith & Petra Todd, 1998. "Characterizing Selection Bias Using Experimental Data," Econometrica, Econometric Society, Econometric Society, vol. 66(5), pages 1017-1098, September.
  18. Carmen Pagés-Serra & James J. Heckman, 2000. "The Cost of Job Security Regulation: Evidence from Latin American Labor Markets," Research Department Publications, Inter-American Development Bank, Research Department 4227, Inter-American Development Bank, Research Department.
  19. 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.
  20. Hugo Ñopo & Miguel Robles & Jaime Saavedra, 2002. "Una medición del impacto del Programa de Capacitación Laboral Juvenil PROJoven," Documentos de Investigación, Grupo de Análisis para el Desarrollo (GRADE) dt36, Grupo de Análisis para el Desarrollo (GRADE).
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Cited by:
  1. Cho, Yoonyoung & Kalomba, Davie & Mobarak, Ahmed Mushfiq & Orozco, Victor, 2013. "Gender differences in the effects of vocational training : constraints on women and drop-out behavior," Policy Research Working Paper Series 6545, The World Bank.
  2. Attanasio, Orazio & Kugler, Adriana & Meghir, Costas, 2009. "Subsidizing Vocational Training for Disadvantaged Youth in Developing Countries: Evidence from a Randomized Trial," IZA Discussion Papers 4251, Institute for the Study of Labor (IZA).
  3. Crombrugghe Denis de & Espinoza Henry & Heijke Hans, 2010. "Job-training programmes with low completion rates: The case of Projoven-Peru," ROA Research Memorandum 004, Maastricht University, Research Centre for Education and the Labour Market (ROA).
  4. Alberto Chong & José Galdo & Jaime Saavedra-Chanduví, 2007. "Informality and Productivity in the Labor Market: Peru 1986 - 2001," Research Department Publications, Inter-American Development Bank, Research Department 4526, Inter-American Development Bank, Research Department.
  5. Alberto Chong & José Galdo & Jaime Saavedra-Chanduví, 2007. "Informalidad y Productividad en el Mercado Laboral: Perú 1986-2001 (Informality and Productivity in the Labor Market: Peru 1986 - 2001)," Research Department Publications, Inter-American Development Bank, Research Department 4527, Inter-American Development Bank, Research Department.
  6. Crombrugghe Denis de & Espinoza Henry & Heijke Hans, 2010. "Determinants of dropout behaviour in a job training programme for disadvantaged youths," ROA Research Memorandum 008, Maastricht University, Research Centre for Education and the Labour Market (ROA).

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