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The Impact of Training Policies in Latin America and the Caribbean: The Case of "Programa Joven"

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    Abstract

    This research evaluates the "Programa Joven", a training program conducted by the Ministerio del Trabajo of Argentina. We adapt and apply a non-experimental evaluation methodology to answer the following questions: Does "Programa Joven" increase the labor income of the trainees? Does "Programa Joven" increase the probability of being employed? And (3) what is the rate of return to dollars spent on the "Programa Joven"? We used Propensity Scores Matching Estimators as our basic methodology to obtain a measure of the impact of the training program. Our choice of this methodological approach was based upon both the theoretical developments in the area of Program Evaluation and the availability of relevant information. We used three different set of data to estimate the Propensity Scores which allowed us to analyze the question on how sensitive Program impact estimates are to different propensity score specifications? This question has not been addressed by the previous literature. Our results indicate first, that Program impact on earnings were statistically significant for young males and adult females. This result was not sensitive to the number of nearest neighbors. Second, the estimated Program impact on employment was statistically significant for adult females only. Again the result was not sensitive to the number of nearest neighbors. Third, impact estimates on earnings and employment for the groups with statistically significant results were not sensitive to the different sources of information used to estimate the propensity scores. This was a surprising result as we expected to observe greater variability in the impact results across different propensity score specifications. Fourth, the cost-benefit exercise conducted suggest that we required at least 9 years of duration of the earnings impact for the Program to have a positive net present value for the groups with statistically significant results.

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    Bibliographic Info

    Paper provided by Ilades-Georgetown University, Universidad Alberto Hurtado/School of Economics and Bussines in its series ILADES-Georgetown University Working Papers with number inv131.

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    Handle: RePEc:ila:ilades:inv131

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    1. Wolfgang Hardle & Oliver Linton, 1994. "Applied Nonparametric Methods," Cowles Foundation Discussion Papers 1069, Cowles Foundation for Research in Economics, Yale University.
    2. repec:att:wimass:9505 is not listed on IDEAS
    3. James Heckman & Hidehiko Ichimura & Jeffrey Smith & Petra Todd, 1998. "Characterizing Selection Bias Using Experimental Data," NBER Working Papers 6699, National Bureau of Economic Research, Inc.
    4. LaLonde, Robert J, 1986. "Evaluating the Econometric Evaluations of Training Programs with Experimental Data," American Economic Review, American Economic Association, vol. 76(4), pages 604-20, September.
    5. James J. Heckman & Jeffrey A. Smith, 1998. "Evaluating the Welfare State," NBER Working Papers 6542, National Bureau of Economic Research, Inc.
    6. Heckman, James J & Ichimura, Hidehiko & Todd, Petra, 1998. "Matching as an Econometric Evaluation Estimator," Review of Economic Studies, Wiley Blackwell, vol. 65(2), pages 261-94, April.
    7. C. F. Manski, . "Learning about social programs from experiments with random assignment of treatments," Institute for Research on Poverty Discussion Papers 1061-95, University of Wisconsin Institute for Research on Poverty.
    8. 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, vol. 64(4), pages 605-54, October.
    9. Heckman, James J & Smith, Jeffrey, 1997. "Making the Most Out of Programme Evaluations and Social Experiments: Accounting for Heterogeneity in Programme Impacts," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 487-535, October.
    10. James J. Heckman & Jeffrey A. Smith, 1999. "The Pre-Program Earnings Dip and the Determinants of Participation in a Social Program: Implications for Simple Program Evaluation Strategies," NBER Working Papers 6983, National Bureau of Economic Research, Inc.
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