Downloads
wp0906.pdf
PDF | 651.88 KB
<p><p>We model the choice of individuals to follow or not apprenticeship training and their subsequent career. We use German administrative data, which records education, labour market transitions and wages to estimate a dynamic discrete choice </p><p></p><p>model of training choice, employment and wage growth. The model allows for returns to experience and tenure, match specific effects, job mobility and search frictions. We show how apprenticeship training affects labour market careers and we quantify its benefits, relative to the overall costs. We then use our model to show how two welfare reforms change life-cycle decisions and human capital accumulation: One is the introduction of an Earned Income Tax Credit in Germany, and the other is a reform to Unemployment Insurance. In both reforms we find very significant impacts of the policy on training choices and on the value of realized matches, demonstrating the importance of considering such longer term implications.</p></p>
Authors
Jerome Adda
Christian Dustmann
Research Fellow Yale University
Costas is a Research Fellow of the IFS and a Professor of Economics at Yale University and a Visiting Professor at University College London.
Research Fellow Sciences Po and University College London
Jean-Marc is a Research Fellow of the IFS and a Professor of Economics at Sciences Po, Paris, and University College London.
Working Paper details
- DOI
- 10.1920/wp.ifs.2009.0906
- Publisher
- IFS
Suggested citation
Adda, J et al. (2009). Career progression and formal versus on-the-job training. London: IFS. Available at: https://ifs.org.uk/publications/career-progression-and-formal-versus-job-training-0 (accessed: 20 May 2024).
More from IFS
Understand this issue
If you can’t see it, you can’t be it: role models influence female junior doctors’ choice of medical specialty
24 April 2024
Sure Start achieved its aims, then we threw it away
15 April 2024
The £600 billion problem awaiting the next government
25 April 2024
Policy analysis
Recent trends in and the outlook for health-related benefits
19 April 2024
4.2 million working-age people now claiming health-related benefits, could rise by 30% by the end of the decade
19 April 2024
The short- and medium-term impacts of Sure Start on educational outcomes
9 April 2024
Academic research
Labour market inequality and the changing life cycle profile of male and female wages
15 April 2024
Interpreting cohort profiles of lifecycle earnings volatility
15 April 2024
There and back again: women’s marginal commuting costs
2 April 2024