Abstract
We present a model of training investments and employment outcomes. In this model training may enhance trainees’ tastes for particular types of career (taste shift) and/or shift their wage offer distributions (pay-off). An empirical analysis is conducted with a unique data-set of UK graduates. These data contain information on students’ career tastes before small-firm placements as well as their employment outcomes after graduation. Analysis of these data indicates that the placements provide a pay-off among highly employable graduates who face certain disadvantages in the labour market. Conversely individuals, who expressed a taste for small-firm careers before placements, are more likely to take-up small-firm employment after placements suggesting these individuals experience enhanced opportunities for their preferred career. However individuals with pre-placement large-firm preferences have no greater likelihood of entering small-firms’ employment after placements indicating there is no fundamental effect on career tastes.
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Fraser, S., Storey, D.J. & Westhead, P. Student Work Placements in Small Firms: Do They Pay-off or Shift Tastes?. Small Bus Econ 26, 125–144 (2006). https://doi.org/10.1007/s11187-004-2438-6
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DOI: https://doi.org/10.1007/s11187-004-2438-6
Keywords
- career preferences
- employment outcomes
- government-subsidised training programmes
- selection bias
- small firms