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The Consequences of Being Different: Statistical Discrimination and the School-to-Work Transition

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Author Info

  • Mueller, Barbara

    ()
    (Swiss Federal Institute for Vocational Education and Training)

  • Wolter, Stefan C.

    ()
    (University of Bern)

Abstract

When information about the true abilities of job-seekers and applicants are hard to get, statistical discrimination by employers can be an efficient strategy in the hiring and wage setting process. But statistical discrimination can induce costs, if labor relations cannot be terminated in the short term and wages are fixed over a certain period. In this paper we use a unique longitudinal survey that follows the PISA 2000 students in their educational and work-life career. We test whether deviance in the PISA test scores from what one would have predicted based on observable characteristics, influences the probability to succeed in the transition from compulsory school into a firm-based apprenticeship and whether it can explain differences of the individual performances during training. Our results suggest that hard-to-get information plays a significant role in the transition, but not always in a symmetric manner.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5474.

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Length: 33 pages
Date of creation: Feb 2011
Date of revision:
Publication status: published as 'The role of hard-to-obtain information on ability for the school-to-work transition' in: Empirical Economics, 2013, [Online First]
Handle: RePEc:iza:izadps:dp5474

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Keywords: statistical discrimination; school-to-work transition; PISA;

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References

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  1. Samuel Muehlemann & Juerg Schweri & Rainer Winkelmann & Stefan C. Wolter, 2007. "An Empirical Analysis of the Decision to Train Apprentices," LABOUR, CEIS, vol. 21(3), pages 419-441, 09.
  2. Galindo-Rueda, Fernando, 2003. "Employer Learning and Schooling-Related Statistical Discrimination in Britain," IZA Discussion Papers 778, Institute for the Study of Labor (IZA).
  3. Bauer, Thomas & Haisken-DeNew, John P, 2000. "Employer Learning And The Returns To Schooling," CEPR Discussion Papers 2445, C.E.P.R. Discussion Papers.
  4. Kathrin Bertschy & M. Alejandra Cattaneo & Stefan C. Wolter, 2009. "PISA and the Transition into the Labour Market," LABOUR, CEIS, vol. 23(s1), pages 111-137, 03.
  5. Bassanini, Andrea & Booth, Alison L. & Brunello, Giorgio & De Paola, Maria & Leuven, Edwin, 2005. "Workplace Training in Europe," IZA Discussion Papers 1640, Institute for the Study of Labor (IZA).
  6. Mühlemann, Samuel & Wolter, Stefan C. & Wüest, Adrian, 2009. "Apprenticeship Training and the Business Cycle," IZA Discussion Papers 4460, Institute for the Study of Labor (IZA).
  7. Wolter, Stefan C. & Ryan, Paul, 2011. "Apprenticeship," Handbook of the Economics of Education, Elsevier.
  8. Brunello, Giorgio, 2009. "The Effect of Economic Downturns on Apprenticeships and Initial Workplace Training: A Review of the Evidence," IZA Discussion Papers 4326, Institute for the Study of Labor (IZA).
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Cited by:
  1. Kirchgässner, Gebhard, 2011. "Wissenschaftlicher Fortschritt in den Wirtschaftswissenschaften: Einige Bemerkungen," Economics Working Paper Series 1116, University of St. Gallen, School of Economics and Political Science.

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