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Do digital skill certificates help new workers enter the market?: Evidence from an online labour platform

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  • Otto Kässi
  • Vili Lehdonvirta

Abstract

This paper studies the effects of a voluntary skill certification scheme in an online freelancing labour market. The paper show that obtaining skill certificates increases a worker’s earnings. This effect is not driven by increased worker productivity but by decreased employer uncertainty. The increase in worker earnings is mostly realised through an increase in the value of the projects obtained (up to 10%) rather than an increase in the number of projects obtained (up to 0.03 projects). In addition, the paper finds evidence for negative selection to completing skill certificates, which suggests that the workers who complete more skill certificates are, on average, in a more disadvantaged position in the labour market. Finally, skill certificates are found to be an imperfect substitute to other types of standardised information. On the whole, the results suggest that certificates play a role in helping new workers break into the labour market, but are more valuable to workers with at least some work experience. More stringent skill certification tests could improve the benefits to new workers.

Suggested Citation

  • Otto Kässi & Vili Lehdonvirta, 2019. "Do digital skill certificates help new workers enter the market?: Evidence from an online labour platform," OECD Social, Employment and Migration Working Papers 225, OECD Publishing.
    • Handle: RePEc:oec:elsaab:225-en
    DOI: 10.1787/3388385e-en
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    Cited by:

    1. Braesemann, Fabian & Stephany, Fabian & Teutloff, Ole & Kässi, Otto & Graham, Mark & Lehdonvirta, Vili, 2021. "The polarisation of remote work," SocArXiv q8a96, Center for Open Science.
    2. Pouliakas, Konstantinos & Ranieri, Antonio, 2022. "Hybrid (Solo)Self-Employment and Upskilling: Is Online Platform Work a Path Towards Entrepreneurship?," IZA Discussion Papers 15344, Institute of Labor Economics (IZA).
    3. Angela Garcia Calvo & Martin Kenney & John Zysman, 2023. "Understanding work in the online platform economy: the narrow, the broad, and the systemic perspectives," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 32(4), pages 795-814.
    4. Guerrero, Maribel & Heaton, Sohvi & Urbano, David, 2021. "Building universities’ intrapreneurial capabilities in the digital era: The role and impacts of Massive Open Online Courses (MOOCs)," Technovation, Elsevier, vol. 99(C).
    5. Wood, Alex & Lehdonvirta, Vili, 2021. "Antagonism beyond employment: how the ‘subordinated agency’ of labour platforms generates conflict in the remote gig economy," SocArXiv y943w, Center for Open Science.
    6. Fabian Braesemann & Fabian Stephany & Ole Teutloff & Otto Kassi & Mark Graham & Vili Lehdonvirta, 2021. "The global polarisation of remote work," Papers 2108.13356, arXiv.org, revised Nov 2022.
    7. Martindale, Nicholas & Lehdonvirta, Vili, 2021. "Can labour market digitalization increase social mobility? Evidence from a European survey of online platform workers," SocArXiv 54aqh, Center for Open Science.

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    More about this item

    Keywords

    gig economy; human capital; online freelancing; platforms; signalling; skill certificates;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • 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
    • I2 - Health, Education, and Welfare - - Education

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