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Assessing the Employment Effects of Labor Market Training Programs in Sweden

Author

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  • Andrén , Daniela

    () (Department of Economics, School of Economics and Commercial Law, Göteborg University)

  • Andrén, Thomas

    () (Department of Economics, School of Economics and Commercial Law, Göteborg University)

Abstract

Several studies have examined the effects of training programs on employment. Most of them assume that the effects of training are constant for all potential trainees. We use an econometric framework that allows studying the heterogeneous training effects on discrete outcomes. The treatment effect is allowed to vary depending on the trainee’s observable and unobservable characteristics, and allows selection into training to be determined in part by the trainee’s idiosyncratic treatment effect. Furthermore, we investigate the importance of the unobservables in the selection to training and how efficient the selection is with respect to the outcome. The results show small positive effects for the Swedish-born. The treatment on the treated is larger than the average treatment effect, indicating that the selection is stronger for the treated, and 40% of those treated gain by participating in training. Foreign-born have a negative effect from training the first year, with an average treatment effect larger than the treatment on the treated. From those who participated in training, only 11% experienced positive effect, while 38% were hurt by the training. The unobserved factors are important in the selection to training, as well as for the outcome. The effect of the selection is stronger for Swedish-born compared to foreign-born.

Suggested Citation

  • Andrén , Daniela & Andrén, Thomas, 2002. "Assessing the Employment Effects of Labor Market Training Programs in Sweden," Working Papers in Economics 70, University of Gothenburg, Department of Economics.
  • Handle: RePEc:hhs:gunwpe:0070
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    File URL: http://hdl.handle.net/2077/2874
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    References listed on IDEAS

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    1. Ashenfelter, Orley C, 1978. "Estimating the Effect of Training Programs on Earnings," The Review of Economics and Statistics, MIT Press, vol. 60(1), pages 47-57, February.
    2. Calmfors, Lars & Forslund, Anders & Hemström, Maria, 2002. "Does Active Labour Market Policy Work? Lessons from the Swedish Experiences," Seminar Papers 700, Stockholm University, Institute for International Economic Studies.
    3. James J. Heckman & Jeffrey A. Smith, 1998. "Evaluating the Welfare State," NBER Working Papers 6542, National Bureau of Economic Research, Inc.
    4. Arild Aakvik & James J. Heckman & Edward J. Vytlacil, 2000. "Treatment Effects for Discrete Outcomes when Responses to Treatment Vary Among Observationally Identical Persons: An Application to Norwegian ..," NBER Technical Working Papers 0262, National Bureau of Economic Research, Inc.
    5. Heckman, James J. & Robb, Richard Jr., 1985. "Alternative methods for evaluating the impact of interventions : An overview," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 239-267.
    6. Robert J. LaLonde, 1995. "The Promise of Public Sector-Sponsored Training Programs," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 149-168, Spring.
    7. A. D. Roy, 1951. "Some Thoughts On The Distribution Of Earnings," Oxford Economic Papers, Oxford University Press, vol. 3(2), pages 135-146.
    8. Bjorklund, Anders & Moffitt, Robert, 1987. "The Estimation of Wage Gains and Welfare Gains in Self-selection," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 42-49, February.
    9. repec:rus:hseeco:10108 is not listed on IDEAS
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    Cited by:

    1. Kluve, Jochen, 2006. "The Effectiveness of European Active Labor Market Policy," IZA Discussion Papers 2018, Institute for the Study of Labor (IZA).
    2. Christian Volpe Martincus & Jerónimo Carballo, 2010. "Entering new country and product markets: does export promotion help?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 146(3), pages 437-467, September.
    3. Volpe Martincus, Christian & Carballo, Jerónimo, 2010. "Beyond the average effects: The distributional impacts of export promotion programs in developing countries," Journal of Development Economics, Elsevier, vol. 92(2), pages 201-214, July.
    4. Brian Krogh Graversen & Peter Jensen, 2010. "A Reappraisal of the Virtues of Private Sector Employment Programmes," Scandinavian Journal of Economics, Wiley Blackwell, vol. 112(3), pages 546-569, September.

    More about this item

    Keywords

    labor market training; one factor model; selection; heterogeneous response; unobserved heterogeneity; treatment on the treated;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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