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Labour Market Effects of Polytechnic Education Reform: The Finnish Experience

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  • Böckerman, Petri
  • Hämäläinen, Ulla
  • Uusitalo, Roope

Abstract

This paper evaluates the labour market effects of the introduction of the polytechnic education system in Finland. The reform transformed former vocational colleges gradually into polytechnics. Since the timing of the reform differed across schools, we can control for macroeconomic changes by comparing the performance of the polytechnic graduates to the performance of vocational college graduates who graduated at the same time, and to control for both time and the school fixed effects at the same time. We discover that both employment levels and earnings of post-reform graduates are significantly higher when compared to pre-reform graduates from the same schools. The effects of the polytechnic reform differ between the three largest fields. In the field of business and administration the effects from the reform have been overwhelmingly positive. This is in accordance with the fact that the polytechnic reform extended the length of education mostly in this field.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 4412.

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Date of creation: 09 Aug 2007
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Handle: RePEc:pra:mprapa:4412

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Keywords: educational economics; human capital; salary wage differentials;

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  1. Erkki Koskela & Roope Uusitalo, 2003. "The Un-Intended Convergence: How the Finnish Unemployment Reached the European Level," CESifo Working Paper Series 878, CESifo Group Munich.
  2. Harmon, Colm & Walker, Ian, 1995. "Estimates of the Economic Return to Schooling for the United Kingdom," American Economic Review, American Economic Association, American Economic Association, vol. 85(5), pages 1278-86, December.
  3. Uusitalo, Roope, 1999. "Return to education in Finland," Labour Economics, Elsevier, Elsevier, vol. 6(4), pages 569-580, November.
  4. Pekkarinen, Tuomas & Uusitalo, Roope & Pekkala, Sari, 2006. "Education Policy and Intergenerational Income Mobility: Evidence from the Finnish Comprehensive School Reform," IZA Discussion Papers 2204, Institute for the Study of Labor (IZA).
  5. Costas Meghir & Marten Palme, 2000. "Assessing the Effect of Schooling on Earnings Using a Social Experiment," Econometric Society World Congress 2000 Contributed Papers, Econometric Society 0670, Econometric Society.
  6. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier.
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