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Returns to Apprenticeship Training in Austria: Evidence from Failed Firms

Author

Listed:
  • Fersterer, Josef

    (University of Linz)

  • Pischke, Jörn-Steffen

    (London School of Economics)

  • Winter-Ebmer, Rudolf

    (Johannes Kepler University Linz)

Abstract

Little is known about the payoffs to apprenticeship training in the German speaking countries for the participants. There is a lot of heterogeneity in the types of apprenticeships offered, and there might be an important element of selection in who obtains an apprenticeship, and what type. To overcome the resulting ability bias we estimate returns to apprenticeship for apprentices in failed firms in Austria. When a firm fails, current apprentices cannot complete their training in this firm. Because apprentices will be at different stages in their apprenticeship, the failure of a firm will manipulate the length of the apprenticeship period completed for some apprentices. The time to failure therefore serves as an instrument for the length of the apprenticeship completed both at the original firm and at other firms. We find instrumental variables returns which are similar or larger than the OLS returns in our sample, indicating relatively little selection.

Suggested Citation

  • Fersterer, Josef & Pischke, Jörn-Steffen & Winter-Ebmer, Rudolf, 2007. "Returns to Apprenticeship Training in Austria: Evidence from Failed Firms," IZA Discussion Papers 3104, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp3104
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    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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