IDEAS home Printed from
   My bibliography  Save this paper

Education Signalling and the School-to-work Transition


  • García-Belenguer, Fernando

    () (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)

  • Moral Carcedo, Julián

    () (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)


This paper studies the relation between labour market institutions and educational systems and how this relation may affect youth unemployment rates. By constructing a signalling model in which education can be used as a signal of workers’ unobserved productivity and firms face firing costs, we investigate how the structure of the educational system and the labour market institutions may influence the school-to-work transition of young unexperienced workers. In particular, we find that different educational systems can lead to different youth unemployment rates, even for high-skilled individuals. Besides, the framework presented in this paper allows to understand how the existence of minimum wages affects individual’s education decision and helps to explain some of the observed empirical regularities.

Suggested Citation

  • García-Belenguer, Fernando & Moral Carcedo, Julián, 2011. "Education Signalling and the School-to-work Transition," Working Papers in Economic Theory 2011/02, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History).
  • Handle: RePEc:uam:wpaper:201102

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. El-Gamal, Mahmoud A. & Grether, David M., 1995. "Are People Bayesian? Uncovering Behavioral Strategies," Working Papers 919, California Institute of Technology, Division of the Humanities and Social Sciences.
    2. Carpenter, Jeffrey P., 2007. "The demand for punishment," Journal of Economic Behavior & Organization, Elsevier, vol. 62(4), pages 522-542, April.
    3. Martin Sefton & Robert Shupp & James M. Walker, 2007. "The Effect Of Rewards And Sanctions In Provision Of Public Goods," Economic Inquiry, Western Economic Association International, vol. 45(4), pages 671-690, October.
    4. Kirchsteiger, Georg, 1994. "The role of envy in ultimatum games," Journal of Economic Behavior & Organization, Elsevier, vol. 25(3), pages 373-389, December.
    5. Cox, James C. & Friedman, Daniel & Gjerstad, Steven, 2007. "A tractable model of reciprocity and fairness," Games and Economic Behavior, Elsevier, vol. 59(1), pages 17-45, April.
    6. Offerman, Theo, 2002. "Hurting hurts more than helping helps," European Economic Review, Elsevier, vol. 46(8), pages 1423-1437, September.
    7. Guth, Werner, 1995. "On ultimatum bargaining experiments -- A personal review," Journal of Economic Behavior & Organization, Elsevier, vol. 27(3), pages 329-344, August.
    8. Abbink, Klaus & Irlenbusch, Bernd & Renner, Elke, 2000. "The moonlighting game: An experimental study on reciprocity and retribution," Journal of Economic Behavior & Organization, Elsevier, vol. 42(2), pages 265-277, June.
    9. Johnson, Tim & Dawes, Christopher T. & Fowler, James H. & McElreath, Richard & Smirnov, Oleg, 2009. "The role of egalitarian motives in altruistic punishment," Economics Letters, Elsevier, vol. 102(3), pages 192-194, March.
    10. Nikiforakis, Nikos, 2008. "Punishment and counter-punishment in public good games: Can we really govern ourselves," Journal of Public Economics, Elsevier, vol. 92(1-2), pages 91-112, February.
    11. Zizzo, Daniel John, 2003. "Money burning and rank egalitarianism with random dictators," Economics Letters, Elsevier, vol. 81(2), pages 263-266, November.
    12. Erte Xiao & Daniel Houser, 2005. "Emotion expression in human punishment behavior," Experimental 0504003, EconWPA, revised 18 May 2005.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Educational systems; youth unemployment; minimum wages.;

    JEL classification:

    • J39 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Other
    • J49 - Labor and Demographic Economics - - Particular Labor Markets - - - Other
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    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:uam:wpaper:201102. 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: (Andrés Maroto-Sánchez). General contact details of provider: .

    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.

    We have no references for this item. You can help adding them by using 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.