Funding Mechanisms for Financing Vocational Training: An Analytical Framework

Adrian Ziderman ()
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Adrian Ziderman: Bar-Ilan University

No 110, IZA Policy Papers from Institute of Labor Economics (IZA)

Abstract: The paper provides an account of innovative financing mechanisms which have been adopted in many national training systems. These mechanisms aim at correcting shortcomings of conventional training finance systems in order to better meet labor market needs, improve both the quality and relevance of training provision and to contain training costs. Directions of change include a greater diversification of funding sources for skills development (including cost sharing and training levies, mainly based on company payrolls), budgeting public training centres through objective funding formulas, encouraging more and higher quality enterprise training, the development of private training markets, increased competition between public and private training providers and the establishment of independent national training funds. Autonomous national training authorities, with broad powers and sizeable stakeholder representation, can be effective in both coordinating and steering national training systems.

Keywords: demand-driven training; funding training institutions; individual learning accounts; Levy-Grant Schemes; national training authorities; payroll levies; private training provision; training finance; training funds; training subsidies; training taxes (search for similar items in EconPapers)
JEL-codes: I22 J08 J24 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2016-04
New Economics Papers: this item is included in nep-lma
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Citations: View citations in EconPapers (1)

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