Active Labour Market Policies and Job Tenure

Bart Cockx, Bruno Van der Linden and Adel Karaa

Oxford Economic Papers, 1998, vol. 50, issue 4, 685-708

Abstract: In this paper, the authors study the effect of subsidized on-the-job training, training for the unemployed, and pure wage subsidies on job tenure. Correcting for selection biases, they find that each of the labor-market policies increases the length of job tenure. Despite the sensitivity of the estimates to the parametric assumptions with respect to the unobservables, the effect of subsidized on-the-job training schemes is always found to be significantly positive. Training programs for the unemployed and pure wage subsidies always have a positive, but statistically nonsignificant, effect. The authors' results provide some support for human capital theories as opposed to matching theories. Copyright 1998 by Royal Economic Society.

Date: 1998
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Working Paper: Active labour market policies and job tenure (1996)
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