Long-term labor market returns to upper secondary school track choice: Leveraging idiosyncratic variation in peers’ choices
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Long-term labor market returns to upper secondary school track choice : Leveraging idiosyncratic variation in peers’ choices. / Birkelund, Jesper Fels; van de Werfhorst, Herman G.
In: Social Science Research, Vol. 102, 102629, 2022.Research output: Contribution to journal › Journal article › Research › peer-review
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TY - JOUR
T1 - Long-term labor market returns to upper secondary school track choice
T2 - Leveraging idiosyncratic variation in peers’ choices
AU - Birkelund, Jesper Fels
AU - van de Werfhorst, Herman G.
PY - 2022
Y1 - 2022
N2 - Vocational education and training (VET) is theorized to play a dual role for inequality of labor market outcomes: the role of a safety net and the role of socioeconomic diversion. In this paper, we test these hypotheses by examining the long-term labor market returns to track choice in upper secondary education in Denmark using an instrumental variable approach that relies on random variation in school peers’ educational decisions. We report two main findings. First, VET diverts students on the margin to the academic track away from higher-status but not higher-paying occupations. Second, VET protects students on the margin to leaving school from risks of non-employment and unskilled work, also leading to higher earnings. These results suggest that in countries with a highly compressed wage structure, a strong VET system benefits students unlikely to continue to college, while causing few adverse consequences for students on the margin to choosing academic education.
AB - Vocational education and training (VET) is theorized to play a dual role for inequality of labor market outcomes: the role of a safety net and the role of socioeconomic diversion. In this paper, we test these hypotheses by examining the long-term labor market returns to track choice in upper secondary education in Denmark using an instrumental variable approach that relies on random variation in school peers’ educational decisions. We report two main findings. First, VET diverts students on the margin to the academic track away from higher-status but not higher-paying occupations. Second, VET protects students on the margin to leaving school from risks of non-employment and unskilled work, also leading to higher earnings. These results suggest that in countries with a highly compressed wage structure, a strong VET system benefits students unlikely to continue to college, while causing few adverse consequences for students on the margin to choosing academic education.
KW - Faculty of Social Sciences
KW - Educational tracking
KW - Vocational education
KW - Labor market outcomes
KW - Earnings
KW - Instrumental variables
KW - Peer effects
U2 - 10.1016/j.ssresearch.2021.102629
DO - 10.1016/j.ssresearch.2021.102629
M3 - Journal article
C2 - 35094761
VL - 102
JO - Social Science Research
JF - Social Science Research
SN - 0049-089X
M1 - 102629
ER -
ID: 279644444