IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/25408.html
   My bibliography  Save this paper

Dynamic Treatment Effects of Job Training

Author

Listed:
  • Jorge Rodríguez
  • Fernando Saltiel
  • Sergio S. Urzúa

Abstract

This paper estimates the dynamic returns to job training. We posit a dynamic-discrete choice model of sequential training participation, where choices and earnings depend on observed and unobserved characteristics.We define treatment effects, including policy relevant parameters, and link them to continuation values. The empirical analysis is carried out using data combining job training records, matched employee-employer information, and pre-labor market ability measures from Chile. We document small positive average returns, large unobserved heterogeneity in responses, and dynamic substitutability of training investments. Our policy relevant treatment effects vary across dynamic response types, highlighting the relevance of our framework.

Suggested Citation

  • Jorge Rodríguez & Fernando Saltiel & Sergio S. Urzúa, 2018. "Dynamic Treatment Effects of Job Training," NBER Working Papers 25408, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:25408
    Note: LS
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w25408.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Orazio Attanasio & Arlen Guarín & Carlos Medina & Costas Meghir, 2015. "Long Term Impacts of Vouchers for Vocational Training: Experimental Evidence for Colombia," BORRADORES DE ECONOMIA 013326, BANCO DE LA REPÚBLICA.
    2. David Card & Jochen Kluve & Andrea Weber, 2009. "Active Labor Market Policy Evaluations: A Meta-analysis," CESifo Working Paper Series 2570, CESifo.
    3. Bocar A. Ba & John C. Ham & Robert J. LaLonde & Xianghong Li, 2017. "Estimating (Easily Interpreted) Dynamic Training Effects from Experimental Data," Journal of Labor Economics, University of Chicago Press, vol. 35(S1), pages 149-200.
    4. Pedro Carneiro & James J. Heckman & Edward Vytlacil, 2010. "Evaluating Marginal Policy Changes and the Average Effect of Treatment for Individuals at the Margin," Econometrica, Econometric Society, vol. 78(1), pages 377-394, January.
    5. Attanasio, Orazio & Cattan, Sarah & Fitzsimons, Emla & Meghir, Costas & Rubio-Codina, Marta, 2015. "Estimating the Production Function for Human Capital: Results from a Randomized Control Trial in Colombia," IZA Discussion Papers 8856, Institute of Labor Economics (IZA).
    6. Hansen, Karsten T. & Heckman, James J. & Mullen, K.J.Kathleen J., 2004. "The effect of schooling and ability on achievement test scores," Journal of Econometrics, Elsevier, vol. 121(1-2), pages 39-98.
    7. Thomas Cornelissen & Christian Dustmann & Anna Raute & Uta Schönberg, 2018. "Who Benefits from Universal Child Care? Estimating Marginal Returns to Early Child Care Attendance," Journal of Political Economy, University of Chicago Press, vol. 126(6), pages 2356-2409.
    8. Pedro Carneiro & Karsten T. Hansen & James J. Heckman, 2003. "Estimating Distributions of Treatment Effects with an Application to the Returns to Schooling and Measurement of the Effects of Uncertainty on College," NBER Working Papers 9546, National Bureau of Economic Research, Inc.
    9. David Card & Jochen Kluve & Andrea Weber, 2010. "Active Labour Market Policy Evaluations: A Meta-Analysis," Economic Journal, Royal Economic Society, vol. 120(548), pages 452-477, November.
    10. Orazio Attanasio & Sarah Cattan & Emla Fitzsimons & Costas Meghir & Marta Rubio-Codina, 2020. "Estimating the Production Function for Human Capital: Results from a Randomized Controlled Trial in Colombia," American Economic Review, American Economic Association, vol. 110(1), pages 48-85, January.
    11. Cattaneo, Matias D., 2010. "Efficient semiparametric estimation of multi-valued treatment effects under ignorability," Journal of Econometrics, Elsevier, vol. 155(2), pages 138-154, April.
    12. Bernd Fitzenberger & Aderonke Osikominu & Robert Völter, 2008. "Get Training or Wait? Long-Run Employment Effects of Training Programs for the Unemployed in West Germany," Annals of Economics and Statistics, GENES, issue 91-92, pages 321-355.
    13. 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.
    14. Heckman, James J. & Navarro, Salvador, 2007. "Dynamic discrete choice and dynamic treatment effects," Journal of Econometrics, Elsevier, vol. 136(2), pages 341-396, February.
    15. Arellano, Manuel & Honore, Bo, 2001. "Panel data models: some recent developments," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.),Handbook of Econometrics, edition 1, volume 5, chapter 53, pages 3229-3296, Elsevier.
    16. Patrick Kline & Christopher R. Walters, 2016. "Evaluating Public Programs with Close Substitutes: The Case of HeadStart," The Quarterly Journal of Economics, Oxford University Press, vol. 131(4), pages 1795-1848.
    17. Carneiro, Pedro & Hansen, Karsten T. & Heckman, James J., 2003. "Estimating Distributions of Treatment Effects with an Application to the Returns to Schooling and Measurement of the Effects of Uncertainty on College Choice," IZA Discussion Papers 767, Institute of Labor Economics (IZA).
    18. Acemoglu, Daron & Pischke, Jorn-Steffen, 1999. "Beyond Becker: Training in Imperfect Labour Markets," Economic Journal, Royal Economic Society, vol. 109(453), pages 112-142, February.
    19. Pedro Carneiro & Karsten T. Hansen & James J. Heckman, 2003. "2001 Lawrence R. Klein Lecture Estimating Distributions of Treatment Effects with an Application to the Returns to Schooling and Measurement of the Effects of Uncertainty on College Choice," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(2), pages 361-422, May.
    20. 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 - Leibniz Centre for European Economic Research.
    21. Andrew Goodman-Bacon, 2018. "Difference-in-Differences with Variation in Treatment Timing," NBER Working Papers 25018, National Bureau of Economic Research, Inc.
    22. Faith Guvenen & Burhan Kuruscu & Satoshi Tanaka & David Wiczer, 2020. "Multidimensional Skill Mismatch," American Economic Journal: Macroeconomics, American Economic Association, vol. 12(1), pages 210-244, January.
    23. Magne Mogstad & Andres Santos & Alexander Torgovitsky, 2018. "Using Instrumental Variables for Inference About Policy Relevant Treatment Parameters," Econometrica, Econometric Society, vol. 86(5), pages 1589-1619, September.
    24. Edward Vytlacil & James J. Heckman, 2001. "Policy-Relevant Treatment Effects," American Economic Review, American Economic Association, vol. 91(2), pages 107-111, May.
    25. Jacklyn Buhrmann, 2017. "Good Enough Jobs: Skill Mismatch and Two-Sided Heterogeneity in Frictional Labor Markets," Purdue University Economics Working Papers 1287, Purdue University, Department of Economics.
    26. Carl Sanders & Christopher Taber, 2012. "Life-Cycle Wage Growth and Heterogeneous Human Capital," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 399-425, July.
    27. repec:eme:rlepps:v:18:y:1999:i:1999:p:439-461 is not listed on IDEAS
    28. Ibarrarán, Pablo & Kluve, Jochen & Ripani, Laura & Shady, David Rosas, 2015. "Experimental evidence on the long term impacts of a youth training program," Ruhr Economic Papers 562, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    29. James Heckman & Rodrigo Pinto & Peter Savelyev, 2013. "Understanding the Mechanisms through Which an Influential Early Childhood Program Boosted Adult Outcomes," American Economic Review, American Economic Association, vol. 103(6), pages 2052-2086, October.
    30. David Card & Pablo Ibarrarán & Ferdinando Regalia & David Rosas-Shady & Yuri Soares, 2011. "The Labor Market Impacts of Youth Training in the Dominican Republic," Journal of Labor Economics, University of Chicago Press, vol. 29(2), pages 267-300.
    31. Andersson, Fredrik & Holzer, Harry J. & Lane, Julia & Rosenblum, David & Smith, Jeffrey A., 2013. "Does Federally-Funded Job Training Work? Nonexperimental Estimates of WIA Training Impacts Using Longitudinal Data on Workers and Firms," IZA Discussion Papers 7621, Institute of Labor Economics (IZA).
    32. Ashenfelter, Orley & Card, David, 1985. "Using the Longitudinal Structure of Earnings to Estimate the Effect of Training Programs," The Review of Economics and Statistics, MIT Press, vol. 67(4), pages 648-660, November.
    33. Orazio Attanasio & Adriana Kugler & Costas Meghir, 2011. "Subsidizing Vocational Training for Disadvantaged Youth in Colombia: Evidence from a Randomized Trial," American Economic Journal: Applied Economics, American Economic Association, vol. 3(3), pages 188-220, July.
    34. Fitzenberger, Bernd & Volter, Robert, 2007. "Long-run effects of training programs for the unemployed in East Germany," Labour Economics, Elsevier, vol. 14(4), pages 730-755, August.
    35. Jorge Rodríguez & Sergio Urzúa & Loreto Reyes, 2016. "Heterogeneous Economic Returns to Post-Secondary Degrees: Evidence from Chile," Journal of Human Resources, University of Wisconsin Press, vol. 51(2), pages 416-460.
    36. Abbring, Jaap H. & Heckman, James J., 2007. "Econometric Evaluation of Social Programs, Part III: Distributional Treatment Effects, Dynamic Treatment Effects, Dynamic Discrete Choice, and General Equilibrium Policy Evaluation," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.),Handbook of Econometrics, edition 1, volume 6, chapter 72, Elsevier.
    37. Heckman, James J. & Humphries, John Eric & Veramendi, Gregory, 2016. "Dynamic treatment effects," Journal of Econometrics, Elsevier, vol. 191(2), pages 276-292.
    38. Brantly Callaway & Pedro H. C. Sant'Anna, 2018. "Difference-in-Differences with Multiple Time Periods and an Application on the Minimum Wage and Employment," DETU Working Papers 1804, Department of Economics, Temple University.
    39. Ingram, Beth F. & Neumann, George R., 2006. "The returns to skill," Labour Economics, Elsevier, vol. 13(1), pages 35-59, February.
    40. Lynch, Lisa M, 1992. "Private-Sector Training and the Earnings of Young Workers," American Economic Review, American Economic Association, vol. 82(1), pages 299-312, March.
    41. Ibarrarán, Pablo & Kluve, Jochen & Ripani, Laura & Rosas Shady, David, 2015. "Experimental Evidence on the Long-Term Impacts of a Youth Training Program," IZA Discussion Papers 9136, Institute of Labor Economics (IZA).
    42. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352-352.
    43. James Heckman & Hidehiko Ichimura & Jeffrey Smith & Petra Todd, 1998. "Characterizing Selection Bias Using Experimental Data," Econometrica, Econometric Society, vol. 66(5), pages 1017-1098, September.
    44. Lechner, Michael, 2009. "Sequential Causal Models for the Evaluation of Labor Market Programs," Journal of Business & Economic Statistics, American Statistical Association, vol. 27, pages 71-83.
    45. Loreto Reyes & Jorge Rodríguez & Sergio S. Urzúa, 2013. "Heterogeneous Economic Returns to Postsecondary Degrees: Evidence from Chile," NBER Working Papers 18817, National Bureau of Economic Research, Inc.
    46. Brantly Callaway & Pedro H. C. Sant'Anna, 2018. "Difference-in-Differences with Multiple Time Periods," Papers 1803.09015, arXiv.org, revised Dec 2020.
    47. Jonathan R. Veum, 1997. "Training and job mobility among young workers in the United States," Journal of Population Economics, Springer;European Society for Population Economics, vol. 10(2), pages 219-233.
    48. Francesco Agostinelli & Matthew Wiswall, 2016. "Identification of Dynamic Latent Factor Models: The Implications of Re-Normalization in a Model of Child Development," NBER Working Papers 22441, National Bureau of Economic Research, Inc.
    49. Jaap H. Abbring & Gerard J. van den Berg, 2003. "The Nonparametric Identification of Treatment Effects in Duration Models," Econometrica, Econometric Society, vol. 71(5), pages 1491-1517, September.
    50. Francesco Agostinelli & Matthew Wiswall, 2016. "Estimating the Technology of Children's Skill Formation," NBER Working Papers 22442, National Bureau of Economic Research, Inc.
    51. Booth, Alison L, 1993. "Private Sector Training and Graduate Earnings," The Review of Economics and Statistics, MIT Press, vol. 75(1), pages 164-170, February.
    Full references (including those not matched with items on IDEAS)

    More about this item

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:25408. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: http://edirc.repec.org/data/nberrus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.