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Quick Job Entry or Long-Term Human Capital Development? The Dynamic Effects of Alternative Training Schemes

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  • Osikominu, Aderonke

    () (University of Hohenheim)

Abstract

This study evaluates and compares the effectiveness of two alternative training schemes for the unemployed: short, job-search oriented training and long, human capital oriented training. We investigate the impact dynamics of these programs considering both unemployment and employment duration. Our analysis uses a rich administrative longitudinal data set for Germany where both programs were implemented at the same time. Our estimation strategy flexibly accounts for dynamic selection on observables and unobservables as well as heterogeneous treatment effects. The results indicate that short-term training schemes can be an effective tool to reduce unemployment in the long run, in particular if participation occurs early during unemployment. Long-term training schemes increase the average duration of employment spells more strongly than short-term training. However, they increase the expected unemployment duration if they are started early during unemployment. This negative short-run impact of long-term training is an important driver of its overall effectiveness.

Suggested Citation

  • Osikominu, Aderonke, 2009. "Quick Job Entry or Long-Term Human Capital Development? The Dynamic Effects of Alternative Training Schemes," IZA Discussion Papers 4638, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp4638
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    Cited by:

    1. Kruppe, Thomas & Lang, Julia, 2014. "Labour market effects of retraining for the unemployed : the role of occupations," IAB Discussion Paper 201420, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    2. Robert W. Fairlie & Dean Karlan & Jonathan Zinman, 2015. "Behind the GATE Experiment: Evidence on Effects of and Rationales for Subsidized Entrepreneurship Training," American Economic Journal: Economic Policy, American Economic Association, vol. 7(2), pages 125-161, May.
    3. Dengler, Katharina, 2015. "Effectiveness of Sequences of Classroom Training for Welfare Recipients: What works best in West Germany?," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113119, Verein für Socialpolitik / German Economic Association.
    4. Martin Biewen & Bernd Fitzenberger & Aderonke Osikominu & Marie Paul, 2014. "The Effectiveness of Public-Sponsored Training Revisited: The Importance of Data and Methodological Choices," Journal of Labor Economics, University of Chicago Press, vol. 32(4), pages 837-897.
    5. Heyer, Gerd & Koch, Susanne & Stephan, Gesine & Wolff, Joachim, 2011. "Evaluation der aktiven Arbeitsmarktpolitik: Ein Sachstandsbericht für die Instrumentenreform 2011 (Evaluation of active labor market programs : a summary of recent results for the German program refor," IAB Discussion Paper 201117, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    6. Lang, Julia & Dauth, Christine, 2017. "Should the unemployed care for the elderly? The effect of subsidized occupational and further training in geriatric care," Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168130, Verein für Socialpolitik / German Economic Association.
    7. Böhm, Sebastian & Grossmann, Volker & Steger, Thomas M., 2015. "Does expansion of higher education lead to trickle-down growth?," Journal of Public Economics, Elsevier, vol. 132(C), pages 79-94.
    8. Eva M. Berger & Günther König & Henning Mueller & Felix Schmidt & Daniel Schunk, 2016. "Self-Regulation Training, Labor Market Reintegration of Unemployed Individuals, and Locus of Control - Evidence from a Natural Field Experiment," CESifo Working Paper Series 6246, CESifo Group Munich.
    9. Bernd Fitzenberger & Olga Orlanski & Aderonke Osikominu & Marie Paul, 2013. "Déjà Vu? Short-term training in Germany 1980–1992 and 2000–2003," Empirical Economics, Springer, vol. 44(1), pages 289-328, February.
    10. Schmidt, Felix & Berger, Eva & Schunk, Daniel & Müller, Henning & König, Günther, 2017. "Self-Regulation Training and Job Search Effort: A Natural Field Experiment within an Active Labor Market Program," Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168177, Verein für Socialpolitik / German Economic Association.
    11. Govert Bijwaard & Stijn Doeselaar, 2014. "The impact of changes in the marital status on return migration of family migrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(4), pages 961-997, October.
    12. Jochen Kluve & Laura Ripani & David Rosas-Shady & Pablo Ibarraran, 2015. "Experimental Evidence on the Long Term Impacts of a Youth Training Program," IDB Publications (Working Papers) 7367, Inter-American Development Bank.
    13. Fitzenberger, Bernd & Furdas, Marina & Sajons, Christoph, 2016. "End-of-year spending and the long-run employment effects of training programs for the unemployed," ZEW Discussion Papers 16-084, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    14. John C. Ham & Xianghong Li & Lara D. Shore-Sheppard, 2016. "The Employment Dynamics of Disadvantaged Women: Evidence from the SIPP," Journal of Labor Economics, University of Chicago Press, vol. 34(4), pages 899-944.
    15. Caliendo, Marco & Künn, Steffen & Uhlendorff, Arne, 2016. "Earnings exemptions for unemployed workers: The relationship between marginal employment, unemployment duration and job quality," Labour Economics, Elsevier, vol. 42(C), pages 177-193.
    16. Reinhard Hujer, 2011. "Mikroökonometrie und Kausalität: Zur Bedeutung arbeitsmarktpolitischer Evaluationsstudien," AStA Wirtschafts- und Sozialstatistisches Archiv, Springer;Deutsche Statistische Gesellschaft - German Statistical Society, vol. 5(1), pages 5-18, March.
    17. Eleftherios Goulas & Athina Zervoyianni, 2017. "Government-sponsored labour-market training and output growth - cyclical, structural and globalization influences," Working Paper series 17-19, Rimini Centre for Economic Analysis.
    18. Aderonke Osikominu, 2016. "The dynamics of training programs for the unemployed," IZA World of Labor, Institute for the Study of Labor (IZA), pages 277-277, July.
    19. Biewen, Martin & Tapalaga, Madalina, 2017. "Early Tracking, Academic vs. Vocational Training and the Value of 'Second Chance' Options," IZA Discussion Papers 11080, Institute for the Study of Labor (IZA).
    20. Dauth, Christine & Lang, Julia, "undated". "Should the unemployed care for the elderly? : The effect of subsidized occupational and further training in elderly care," IAB Discussion Paper 201713, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

    More about this item

    Keywords

    active labor market policy; dynamic treatment effects; duration analysis; program evaluation; training; multiple treatments;

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

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