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Workplace Training Programs: Instruments for Human Capital Improvements or Screening Devices?

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  • Brunetti, Irene
  • Corsini, Lorenzo

Abstract

In this paper we analyse the effect of an Italian training program on the re-employment probability of young unemployed workers. The program consists solely of workplace training and is coordinated by employment centre, but it is fully implemented by firms. We develop a discrete duration analysis and our results suggest that workplace training improves only the immediate re-employability of trained workers, failing to bestow them with durable human capital improvements. These results appear to be robust to spurious duration dependence and to self-selection. Our analysis focuses on the role of unobserved heterogeneity and, accounting for it, we show that the training implementation is useful to sort “good” trainees from “bad” ones: therefore we suggest that firms are exploiting training as a screening device.

Suggested Citation

  • Brunetti, Irene & Corsini, Lorenzo, 2014. "Workplace Training Programs: Instruments for Human Capital Improvements or Screening Devices?," MPRA Paper 55943, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:55943
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    duration model; policy evaluation; propensity score matching; screening device; workplace training; youth unemployment.;
    All these keywords.

    JEL classification:

    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training

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