Working Paper: NBER ID: w21607
Authors: Adriana Kugler; Maurice Kugler; Juan Saavedra; Luis Omar Herrera Prada
Abstract: We use administrative data and a randomization design to examine the long-term educational impacts of a large-scale vocational training program for disadvantaged youth in Colombia on trainees and their relatives. Up to eleven years after randomization, trainees were more likely to enroll in formal tertiary education, and their relatives more likely to complete secondary schooling. Various empirical tests suggest that, for females, vocational training helped relax credit constraints stemming from the direct costs of tertiary education. For males, the evidence suggests that additional tertiary education investments arise from the program improving field-specific knowledge and/or information about field-specific returns to tertiary education. Focusing only on labor-market outcomes and not accounting for these long-term tertiary education impacts on participants substantially understates the social desirability of the Colombian vocational training program. By contrast, including tertiary education impacts on participants increases the program’s internal rate of return for women from 22.2% to 23.5% and for men from 10.2% to 20.5%.
Keywords: Vocational Training; Education; Colombia; Youth; Labor Market
JEL Codes: J24; J38; J60; O17; O54
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Vocational training (M53) | formal tertiary education enrollment (I23) |
| Vocational training (M53) | spillover effects on relatives' educational attainment (I24) |
| Vocational training (M53) | relaxation of credit constraints (E51) |
| Vocational training (M53) | increased knowledge about specific skills and their returns (J24) |
| Vocational training (M53) | internal rates of return on educational investments (I26) |