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

  • Osikominu, Aderonke

    ()

    (University of Hohenheim)

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.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4638.

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Length: 68 pages
Date of creation: Dec 2009
Date of revision:
Handle: RePEc:iza:izadps:dp4638
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  1. David Card & Jochen Kluve & Andrea Weber, 2010. "Active Labor Market Policy Evaluations: A Meta-Analysis," NBER Working Papers 16173, National Bureau of Economic Research, Inc.
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  16. Donald, Stephen G & Green, David A & Paarsch, Harry J, 2000. "Differences in Wage Distributions between Canada and the United States: An Application of a Flexible Estimator of Distribution Functions in the Presence of Covariates," Review of Economic Studies, Wiley Blackwell, vol. 67(4), pages 609-33, October.
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  21. Bruno Crépon & Marc Ferracci & Denis Fougère, 2007. "Training the Unemployed in France : How does it Affect Unemployment Duration and Recurrence ?," Working Papers 2007-32, Centre de Recherche en Economie et Statistique.
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  24. Couch, Kenneth A, 1992. "New Evidence on the Long-Term Effects of Employment Training Programs," Journal of Labor Economics, University of Chicago Press, vol. 10(4), pages 380-88, October.
  25. Bonnal, Liliane & Fougere, Denis & Serandon, Anne, 1997. "Evaluating the Impact of French Employment Policies on Individual Labour Market Histories," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 683-713, October.
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