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Revisiting the Economics of Vocational Education: Estimating the Impact of Vocational Education on Labour Market Outcomes in Germany

Authors:

Ola Aboukhsaiwan ,

Ju Yeon (Anna) Kim,

Caroline Maschka,

Xiao Rong (Isabelle) Lim,

Celine Mano

Abstract

This paper investigates the impact of vocational education on labour market outcomes in Germany. The hypothesis rests on the mechanism that educational attainment affects earnings potential, risk of unemployment, length of unemployment, and risk of termination by employer. Results are obtained based on a matching strategy and instrumental variable estimation exploiting the exogenous variation in German states’ budgets allocations towards vocational education. We find no effect on wages and negative and significant effects on risk of unemployment and length of unemployment. The results of this paper call for more inventive policy development, particularly in the domain of skill formation in early life.

How to Cite: Aboukhsaiwan, O., Kim, J.Y. (Anna) ., Maschka, C., Lim, X.R. (Isabelle) . and Mano, C., 2020. Revisiting the Economics of Vocational Education: Estimating the Impact of Vocational Education on Labour Market Outcomes in Germany. Rationale, 2, pp.1–34.
Published on 20 Jul 2020.
Peer Reviewed

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