Do Dropouts Benefit from Training Programs? Korean Evidence Employing Methods for Continuous Treatments

39 Pages Posted: 6 Nov 2011

See all articles by Chung Choe

Chung Choe

Hanyang University

Alfonso Flores-Lagunes

Syracuse University--Economics; Syracuse University--CPR; IZA, Bonn

Sang-Jun Lee

Independent

Abstract

Failure of participants to complete training programs is pervasive in existing active labor market programs both in developed and developing countries. The proportion of dropouts in prototypical programs ranges from 10 to 50 percent of all participants. From a policy perspective, it is of interest to know if dropouts benefit from the time they spend in training since these programs require considerable resources. We shed light on this issue by estimating the average employment effects of different lengths of exposure to a program by dropouts in a Korean job training program. To do this, we employ parametric and semiparametric methods to estimate effects from continuous treatments using the generalized propensity score, under the assumption that selection into different lengths of exposure is based on a rich set of observed covariates. We find that participants who drop out later – thereby having longer exposures – exhibit higher employment probabilities one year after receiving training, and that marginal effects of additional exposure to training are initially fairly small, but increase sharply past a certain threshold of exposure. One implication of these results is that this and similar programs could benefit from providing incentives for participants to stay longer in the program.

Keywords: training programs, dropouts, developing countries, continuous treatments, generalized propensity score, dose-response function

JEL Classification: O15, I38, C21

Suggested Citation

Choe, Chung and Flores-Lagunes, Alfonso and Lee, Sang-Jun, Do Dropouts Benefit from Training Programs? Korean Evidence Employing Methods for Continuous Treatments. IZA Discussion Paper No. 6064, Available at SSRN: https://ssrn.com/abstract=1955404

Chung Choe (Contact Author)

Hanyang University ( email )

Ansan
Korea, Republic of (South Korea)

HOME PAGE: http://https://sites.google.com/site/choechung/home

Alfonso Flores-Lagunes

Syracuse University--Economics ( email )

Syracuse, NY 13244-1020
United States

HOME PAGE: http://www.maxwell.syr.edu/econ/cpr/Alfonso_Flores_Lagunes/

Syracuse University--CPR ( email )

Syracuse, NY 13244
United States

HOME PAGE: http://www.maxwell.syr.edu/econ/cpr/Alfonso_Flores_Lagunes/

IZA, Bonn ( email )

P.O. Box 7240
Bonn, D-53072
Germany

HOME PAGE: http://www.iza.org/profile?key=2305

Sang-Jun Lee

Independent ( email )

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