The Effects of Working While in School: Evidence from Uruguayan Lotteries
82 Pages Posted: 15 Jun 2019 Last revised: 18 Jan 2020
Date Written: January 15, 2020
We provide the first estimates of the effects of working while in school that use controlled random variation in job offers. We leverage a Uruguayan program offering 9-to-12-month part-time employment in state-owned companies by lottery to enrolled students. Using social security data matched to the universe of over 120,000 applicants, we estimate a 9% increase in earnings over the four post-program years for youth completing a program job. We find large positive effects on school enrollment during the program year, consistent with the conditionality of the program and smaller effects in the post-program years. Our time-use survey indicates that students substitute leisure and household chores with work, without significant reductions in studying time. Finally, a decomposition of the earnings effect shows that accumulation of work experience can explain the majority of the increase in earnings.
Keywords: student employment, randomized lottery, program at scale, human capital accumulation
JEL Classification: J08, J22, J24, I21, I28
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