Journal Article

Training, wages, and sample selection

Lee, David S

2009

Overview

This paper empirically assesses the wage effects of the Job Corps program, one of the largest federally funded job training programs in the U.S. Even with the aid of a randomized experiment, the impact of a training program on wages is difficult to study because of sample selection, a pervasive problem in applied microeconometric research. Wage rates are only observed for those who are employed, and employment status itself may be affected by the training program. This paper develops an intuitive trimming procedure for bounding average treatment effects in the presence of sample selection. In contrast to existing methods, the procedure requires neither exclusion restrictions nor a bounded support for the outcome of interest. Identification results, estimators, and their asymptotic distribution are presented. The bounds suggest that the program raised wages, consistent with the notion that the Job Corps raises earnings by increasing human capital, rather than solely through encouraging work. The estimator is generally applicable to typical treatment evaluation problems in which there is nonrandom sample selection/attrition.

• Publisher: Oxford, UK : Blackwell Publishing Ltd,Wiley-Blackwell,Review of Economic Studies Ltd., Blackwell Publishing,Oxford University Press
• Subject: Albs / Arbeitskraft / Arbeitsmarktpolitik / Asymptotic methods / Attrition / Auswahlverfahren / Berufsvorbereitung / Consistent estimators / Control groups / Earnings / Econometrics / Educational programs / Employment / Employment status / Estimating techniques / Estimators / Human capital / J24 / J31 / Job training / Jugendlicher / Lohn / Methodological problems / Proportions / Sampling methods / Statistik / Studies / USA / Wage rate / Wage rates / Wages / Wages & salaries / Wirkungsanalyse / Wirtschaftspolitik