Training Quality and Earnings: The Effects of Competition on the Provision of Public-Sponsored Training Programs

Alberto Chong and Jose Galdo

No 3297, IDB Publications (Working Papers) from Inter-American Development Bank

Abstract: This paper evaluates the effectiveness of market-based approaches in the provision of public-sponsored training programs. In particular, we study the link between training quality and labor earnings using a Peruvian program that targets disadvantaged youths. Multiple proxies for training quality are identified from bidding processes in which public and private training institutions that operate for profit compete for limited public funding. Using difference-in-differences kernel matching and standard regression-based approaches, we find that beneficiaries attending high-quality training courses have higher average and marginal treatment impacts. These earnings differentials are larger for females rather than males, and are larger in the medium term rather than in the short run. External validity was assessed by using five different cohorts of individuals over an eight-year period.

Keywords: training quality; earnings; bidding; matching methods (search for similar items in EconPapers)
JEL-codes: H43 I38 (search for similar items in EconPapers)
Date: 2006-08
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:idb:brikps:3297

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