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Estimating complementarity between education and training

Author

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  • Christian Belzil

    (X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique, IZA - Institute for the Study of Labor, ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique, CIREQ - Centre Interuniversitaire de Recherche en Economie Quantitative)

  • J. Hansen

    (IZA - Institute for the Study of Labor, CIREQ - Centre Interuniversitaire de Recherche en Economie Quantitative, CIRANO - Montréal, Department of Economics, Concordia University - Concordia University [Montreal])

  • Nicolai Kristensen

    (Danish Institute of Governmental Research - AKF, Aarhus University [Aarhus])

Abstract

In this paper, we formulate and estimate a structural model of post-schooling training that explicitly allows for possible complementarity between initial schooling levels and returns to training. Precisely, the wage outcome equation depends on accumulated schooling and on the incidence of training. The effect of training on wage growth depends on individual permanent endowments as well as on education. We find evidence of statistically significant complementarity, i.e. the higher educated receive the highest return to the MBA-type training considered here.

Suggested Citation

  • Christian Belzil & J. Hansen & Nicolai Kristensen, 2009. "Estimating complementarity between education and training," Working Papers hal-00365698, HAL.
  • Handle: RePEc:hal:wpaper:hal-00365698
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00365698
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    References listed on IDEAS

    as
    1. Keane, Michael P., 2010. "Structural vs. atheoretic approaches to econometrics," Journal of Econometrics, Elsevier, vol. 156(1), pages 3-20, May.
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    13. Christian Belzil & Jörgen Hansen, 2002. "Unobserved Ability and the Return to Schooling," Econometrica, Econometric Society, vol. 70(5), pages 2075-2091, September.
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    More about this item

    Keywords

    Skill Complementarity; Dynamic Treatment Effects; Dynamic Programming; Random Coefficients;
    All these keywords.

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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