Swedish Labor Market Training and the Duration of Unemployment
IFAU - Office of Labour Market Policy Evaluation
Gerard J. Van den Berg
VU University Amsterdam - Department of Economics; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA); Tinbergen Institute
IZA Discussion Paper No. 2314
The vocational employment training program is the most ambitious and expensive training program in Sweden and a cornerstone of labor market policy. We analyze causal effects on the individual transition rate from unemployment to employment by exploiting variation in the timing of treatment and outcome, dealing with selectivity on unobservables. We demonstrate the appropriateness of this approach in our context by studying the assignment. We also develop a model allowing for duration dependence and unobserved heterogeneity (leading to spurious duration dependence) in the treatment effect, and we prove non-parametric identification. The data cover the population and include multiple unemployment spells for many individuals. The results indicate a large significantly positive effect on exit to work shortly after exiting the program. The effect at the individual level diminishes after some weeks. When taking account of the time spent in the program, the effect on the mean unemployment duration is often close to zero.
Number of Pages in PDF File: 47
Keywords: vocational training, program evaluation, duration analysis, selectivity bias
JEL Classification: J64, C14working papers series
Date posted: October 3, 2006
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