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The role of hard-to-obtain information on ability for the school-to-work transition

Listed author(s):
  • Barbara Mueller
  • Stefan Wolter

    ()

When information about the abilities of job seekers is difficult to obtain, statistical discrimination by employers may be an efficient strategy in the hiring and wage-setting process. In this article, we use a unique, longitudinal survey that follows the PISA 2000 students in their early educational and work–life careers. We find that a deviance in the PISA test scores from what one would have predicted based on easy-to-obtain observable characteristics influences the probability of succeeding in the transition from compulsory schooling to a firm-based apprenticeship significantly but in a non-symmetric way. Only those who had a test result below their predicted result have significantly lower chances of getting an apprenticeship. We also find evidence that the importance of hard-to-obtain information on ability is further revealed in the course of the apprenticeship. Copyright Springer-Verlag Berlin Heidelberg 2014

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File URL: http://hdl.handle.net/10.1007/s00181-013-0709-2
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Article provided by Springer in its journal Empirical Economics.

Volume (Year): 46 (2014)
Issue (Month): 4 (June)
Pages: 1447-1471

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Handle: RePEc:spr:empeco:v:46:y:2014:i:4:p:1447-1471
DOI: 10.1007/s00181-013-0709-2
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Order Information: Web: http://www.springer.com/economics/econometrics/journal/181/PS2

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  1. Galindo-Rueda, Fernando, 2003. "Employer Learning and Schooling-Related Statistical Discrimination in Britain," Royal Economic Society Annual Conference 2003 82, Royal Economic Society.
  2. Bauer, Thomas K. & Haisken-DeNew, John P., 2001. "Employer learning and the returns to schooling," Labour Economics, Elsevier, vol. 8(2), pages 161-180, May.
  3. Henry S. Farber & Robert Gibbons, 1996. "Learning and Wage Dynamics," The Quarterly Journal of Economics, Oxford University Press, vol. 111(4), pages 1007-1047.
  4. Robert H. Topel & Michael P. Ward, 1992. "Job Mobility and the Careers of Young Men," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 439-479.
  5. 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.
  6. Joseph G. Altonji & Charles R. Pierret, 2001. "Employer Learning and Statistical Discrimination," The Quarterly Journal of Economics, Oxford University Press, vol. 116(1), pages 313-350.
  7. Fabian Lange, 2007. "The Speed of Employer Learning," Journal of Labor Economics, University of Chicago Press, vol. 25, pages 1-35.
  8. Phelps, Edmund S, 1972. "The Statistical Theory of Racism and Sexism," American Economic Review, American Economic Association, vol. 62(4), pages 659-661, September.
  9. Dennis J. Aigner & Glen G. Cain, 1977. "Statistical Theories of Discrimination in Labor Markets," ILR Review, Cornell University, ILR School, vol. 30(2), pages 175-187, January.
  10. 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.
  11. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, Oxford University Press, vol. 87(3), pages 355-374.
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