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Training disadvantaged youth in Latin America: evidence from a randomized trial

Attanasio, O.; Kugler, A.; Meghir, C.; (2008) Training disadvantaged youth in Latin America: evidence from a randomized trial. (IFS Working Papers EWP08/). Institute for Fiscal Studies: London, UK. Green open access

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Abstract

Youth unemployment in Latin America is exceptionally high, as much as 50% among the poor. Vocational training may be the best chance to help unemployed young people at the bottom of the income distribution. This paper evaluates the impact of a randomized training program for disadvantaged youth introduced in Colombia in 2005 on the employment and earnings of trainees. This is one of a couple of randomized training trials conducted in developing countries and, thus, offers a unique opportunity to examine the causal impact of training in a developing country context. We use originally collected data on individuals randomly offered and not offered training. We find that the program raises earnings and employment for both men and women, with larger effects on women. Women offered training earn about 18% more than those not offered training, while men offered training earn about 8% more than men not offered training. Much of the earnings increases for both men and women are related to increased employment in formal sector jobs following training. The benefits of training are greater when individuals spend more time doing on-the-job training, while hours of training in the classroom have no impact on the returns to training. Cost-benefit analysis of these results suggests that the program generates a large net gain, especially for women.

Type: Working / discussion paper
Title: Training disadvantaged youth in Latin America: evidence from a randomized trial
Open access status: An open access version is available from UCL Discovery
Publisher version: http://www.ifs.org.uk/publications/4174
Language: English
UCL classification: UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of SandHS > Dept of Economics
URI: http://discovery.ucl.ac.uk/id/eprint/14747
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