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The Heterogeneous Effects of Training Incidence and Duration on Labor Market Transitions

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Author Info

  • Fitzenberger, Bernd

    ()
    (University of Freiburg)

  • Osikominu, Aderonke

    ()
    (University of Hohenheim)

  • Paul, Marie

    ()
    (University of Freiburg)

Abstract

This paper estimates the impact of training incidence and duration on employment transitions accounting for the endogeneity of program participation and duration. We specify a very flexible bivariate random effects probit model for employment and training participation and we use Bayesian Markov Chain Monte Carlo (MCMC) techniques for estimation. We develop a simulation approach that uses the estimated coefficients and individual specific effects from the MCMC iterations to calculate the posterior distributions of different treatment effects of interest. Our estimation results imply positive effects of training on the employment probability of the treated, lying between 12 and 21 percentage points ten quarters after program start. The effects are higher for women than for men and higher in West Germany than in East Germany. Further, we find that the effect of training versus waiting underestimates the effect of training versus no training in the medium and long run by a third. Finally, our results show that longer planned enrolment lengths of three and four quarters as opposed to just two quarters lead to an increase in employment rates in the medium and long run by four to eleven percentage points.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5269.

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Length: 62 pages
Date of creation: Oct 2010
Date of revision:
Handle: RePEc:iza:izadps:dp5269

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Related research

Keywords: evaluation; active labor market programs; dynamic non-linear panel data models; MCMC;

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References

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  1. Alfonso Flores-Lagunes & Arturo Gonzalez & Todd C. Neumann, 2007. "Estimating the Effects of Length of Exposure to a Training Program: The Case of Job Corps," Working Papers 1042, Princeton University, Department of Economics, Industrial Relations Section..
  2. Martin, John P. & Grubb, David, 2001. "What works and for whom: a review of OECD countries' experiences with active labour market policies," Working Paper Series 2001:14, IFAU - Institute for Evaluation of Labour Market and Education Policy.
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Cited by:
  1. 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 201117, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  2. Kluve, Jochen & Rinne, Ulf & Uhlendorff, Arne & Zhao, Zhong, 2012. "Endogenous Exit Bias in Training Programs for Unemployed Workers," IZA Discussion Papers 6565, Institute for the Study of Labor (IZA).
  3. Bräuninger, Michael & Michaelis, Jochen & Sode, Madlen, 2013. "10 Jahre Hartz-Reformen," HWWI Policy Papers 73, Hamburg Institute of International Economics (HWWI).
    • Michael Bräuninger & Jochen Michaelis & Madlen Sode, 2013. "10 Jahre Hartz-Reformen," MAGKS Papers on Economics 201318, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  4. repec:idb:brikps:38038 is not listed on IDEAS
  5. Ham, John C. & Woutersen, Tiemen, 2011. "Calculating Confidence Intervals for Continuous and Discontinuous Functions of Estimated Parameters," IZA Discussion Papers 5816, Institute for the Study of Labor (IZA).
  6. Kelly, Elish & McGuinness, Seamus & O'Connell, Philip J., 2011. "What Can Active Labour Market Policies Do?," Papers EC1, Economic and Social Research Institute (ESRI).
  7. Fernández-Kranz, Daniel & Paul, Marie & Rodríguez-Planas, Núria, 2011. "Part-Time Work, Fixed-Term Contracts, and the Returns to Experience," IZA Discussion Papers 5815, Institute for the Study of Labor (IZA).
  8. Tiemen Woutersen & John Ham, 2013. "Calculating confidence intervals for continuous and discontinuous functions of parameters," CeMMAP working papers CWP23/13, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.

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