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Supply Shocks in th...
Supply Shocks in the Market for Apprenticeship Training
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Muehlemann, Samuel (author)
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Dietrich, Hans (author)
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- Pfann, Gerard (author)
- Stockholms universitet,Institutet för social forskning (SOFI),Institute of Labor Economics (IZA), Germany; School of Business and Economics, The Netherlands; CESifo, Germany; CEPR, United Kingdom
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Pfeifer, Harald (author)
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(creator_code:org_t)
- Elsevier BV, 2022
- 2022
- English.
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In: Economics of Education Review. - : Elsevier BV. - 0272-7757 .- 1873-7382. ; 86
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https://doi.org/10.1...
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Abstract
Subject headings
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- We present a model with heterogeneous inputs and constant elasticity of substitution to examine the possible effects of a supply shock in the market for apprenticeship training. The model’s predictions are tested using data from a German high school reform that led to a one-time increase in the supply of highly educated apprentices. A difference-in-differences estimation strategy exploits regional variation in the timing of implementation, and an instrumental variable approach identifies the supply shock effects. We find that apprenticeship contracts among individuals with a high school degree increased by 7%, while apprentice wages were unaffected by the supply shock. Moreover, we find no evidence of substitution effects, as the number of training contracts among individuals with a lower-level school degree did not decrease. Our model predicts that such effects may occur when wages are sticky for apprentices with a high level of education relative to their productivity, which signals inefficiencies in the market for apprenticeship training.
Subject headings
- SAMHÄLLSVETENSKAP -- Ekonomi och näringsliv (hsv//swe)
- SOCIAL SCIENCES -- Economics and Business (hsv//eng)
Keyword
- Apprenticeship market
- Labor supply shock
- School reform
- Wage rigidity
Publication and Content Type
- ref (subject category)
- art (subject category)
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