IDEAS home Printed from https://ideas.repec.org/a/aea/aejapp/v15y2023i1p383-410.html
   My bibliography  Save this article

The Effects of Working While in School: Evidence from Employment Lotteries

Author

Listed:
  • Thomas Le Barbanchon
  • Diego Ubfal
  • Federico Araya

Abstract

Does working while in school smooth students' transition into the labor market? We provide evidence on this question by leveraging a one-year work-study program that randomized job offers among over 90,000 student applicants in Uruguay. Program rules forbade employers from employing participants in the same job after program completion, and less than 5 percent of participants ever worked in the same firm again. Two years after the program, participants had 8 percent higher earnings. Our results suggest that the program's focus on work-related skills was a key mechanism for earnings impacts.

Suggested Citation

  • Thomas Le Barbanchon & Diego Ubfal & Federico Araya, 2023. "The Effects of Working While in School: Evidence from Employment Lotteries," American Economic Journal: Applied Economics, American Economic Association, vol. 15(1), pages 383-410, January.
    • Handle: RePEc:aea:aejapp:v:15:y:2023:i:1:p:383-410
    DOI: 10.1257/app.20210041
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/app.20210041
    Download Restriction: no
    File URL: https://doi.org/10.3886/E151261V1
    Download Restriction: no
    File URL: https://www.aeaweb.org/doi/10.1257/app.20210041.appx
    Download Restriction: no
    File URL: https://www.aeaweb.org/doi/10.1257/app.20210041.ds
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    File URL: https://libkey.io/10.1257/app.20210041?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Verónica Escudero & Jochen Kluve & Elva López Mourelo & Clemente Pignatti, 2019. "Active Labour Market Programmes in Latin America and the Caribbean: Evidence from a Meta-Analysis," Journal of Development Studies, Taylor & Francis Journals, vol. 55(12), pages 2644-2661, December.
    2. Abhijit Banerjee & Rukmini Banerji & James Berry & Esther Duflo & Harini Kannan & Shobhini Mukerji & Marc Shotland & Michael Walton, 2017. "From Proof of Concept to Scalable Policies: Challenges and Solutions, with an Application," Journal of Economic Perspectives, American Economic Association, vol. 31(4), pages 73-102, Fall.
    3. David McKenzie, 2017. "How Effective Are Active Labor Market Policies in Developing Countries? A Critical Review of Recent Evidence," The World Bank Research Observer, World Bank, vol. 32(2), pages 127-154.
    4. Clément de Chaisemartin & Luc Behaghel, 2020. "Estimating the Effect of Treatments Allocated by Randomized Waiting Lists," Econometrica, Econometric Society, vol. 88(4), pages 1453-1477, July.
    5. Guido W. Imbens & Charles F. Manski, 2004. "Confidence Intervals for Partially Identified Parameters," Econometrica, Econometric Society, vol. 72(6), pages 1845-1857, November.
    6. Eszter Czibor & David Jimenez‐Gomez & John A. List, 2019. "The Dozen Things Experimental Economists Should Do (More of)," Southern Economic Journal, John Wiley & Sons, vol. 86(2), pages 371-432, October.
    7. Joseph G. Altonji & Charles R. Pierret, 2001. "Employer Learning and Statistical Discrimination," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(1), pages 313-350.
    8. James J. Heckman, 2010. "Building Bridges between Structural and Program Evaluation Approaches to Evaluating Policy," Journal of Economic Literature, American Economic Association, vol. 48(2), pages 356-398, June.
    9. James J. Heckman & Jora Stixrud & Sergio Urzua, 2006. "The Effects of Cognitive and Noncognitive Abilities on Labor Market Outcomes and Social Behavior," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 411-482, July.
    10. Ubfal, Diego & Arráiz, Irani & Beuermann, Diether W. & Frese, Michael & Maffioli, Alessandro & Verch, Daniel, 2022. "The impact of soft-skills training for entrepreneurs in Jamaica," World Development, Elsevier, vol. 152(C).
    11. David Lagakos & Benjamin Moll & Tommaso Porzio & Nancy Qian & Todd Schoellman, 2018. "Life Cycle Wage Growth across Countries," Journal of Political Economy, University of Chicago Press, vol. 126(2), pages 797-849.
    12. Franz Buscha & Arnaud Maurel & Lionel Page & Stefan Speckesser, 2012. "The Effect of Employment while in High School on Educational Attainment: A Conditional Difference-in-Differences Approach," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 74(3), pages 380-396, June.
    13. Pierre Cahuc & Stéphane Carcillo & Andreea Minea, 2021. "The Difficult School-to-Work Transition of High School Dropouts: Evidence from a Field Experiment," Journal of Human Resources, University of Wisconsin Press, vol. 56(1), pages 159-183.
    14. Achyuta Adhvaryu & Namrata Kala & Anant Nyshadham, 2018. "The Skills to Pay the Bills: Returns to On-the-job Soft Skills Training," NBER Working Papers 24313, National Bureau of Economic Research, Inc.
    15. V. Joseph Hotz & Lixin Colin Xu & Marta Tienda & Avner Ahituv, 2002. "Are There Returns To The Wages Of Young Men From Working While In School?," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 221-236, May.
    16. Crepon,Bruno Jacques Jean Philippe & Premand,Patrick, 2018. "Creating new positions ? direct and indirect effects of a subsidized apprenticeship program," Policy Research Working Paper Series 8561, The World Bank.
    17. Jared Ashworth & V. Joseph Hotz & Arnaud Maurel & Tyler Ransom, 2021. "Changes across Cohorts in Wage Returns to Schooling and Early Work Experiences," Journal of Labor Economics, University of Chicago Press, vol. 39(4), pages 931-964.
    18. Livia Alfonsi & Oriana Bandiera & Vittorio Bassi & Robin Burgess & Imran Rasul & Munshi Sulaiman & Anna Vitali, 2020. "Tackling Youth Unemployment: Evidence From a Labor Market Experiment in Uganda," Econometrica, Econometric Society, vol. 88(6), pages 2369-2414, November.
    19. Ruhm, Christopher J, 1997. "Is High School Employment Consumption or Investment?," Journal of Labor Economics, University of Chicago Press, vol. 15(4), pages 735-776, October.
    20. Matthew Groh & Nandini Krishnan & David McKenzie & Tara Vishwanath, 2016. "Do Wage Subsidies Provide a Stepping-Stone to Employment for Recent College Graduates? Evidence from a Randomized Experiment in Jordan," The Review of Economics and Statistics, MIT Press, vol. 98(3), pages 488-502, July.
    21. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097, Elsevier.
    22. Paloma Acevedo & Guillermo Cruces & Paul Gertler & Sebastian Martinez, 2017. "Living Up to Expectations: How Job Training Made Women Better Off and Men Worse Off," NBER Working Papers 23264, National Bureau of Economic Research, Inc.
    23. Henry S. Farber & Robert Gibbons, 1996. "Learning and Wage Dynamics," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(4), pages 1007-1047.
    24. David S. Lee, 2009. "Training, Wages, and Sample Selection: Estimating Sharp Bounds on Treatment Effects," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(3), pages 1071-1102.
    25. German Blanco & Carlos A. Flores & Alfonso Flores-Lagunes, 2013. "The Effects of Job Corps Training on Wages of Adolescents and Young Adults," American Economic Review, American Economic Association, vol. 103(3), pages 418-422, May.
    26. David J. Deming, 2017. "The Growing Importance of Social Skills in the Labor Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(4), pages 1593-1640.
    27. Alexander Gelber & Adam Isen & Judd B. Kessler, 2016. "The Effects of Youth Employment: Evidence from New York City Lotteries," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(1), pages 423-460.
    28. Sule Alan & Teodora Boneva & Seda Ertac, 2019. "Ever Failed, Try Again, Succeed Better: Results from a Randomized Educational Intervention on Grit," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 134(3), pages 1121-1162.
    29. Orazio Attanasio & Adriana Kugler & Costas Meghir, 2011. "Subsidizing Vocational Training for Disadvantaged Youth in Colombia: Evidence from a Randomized Trial," American Economic Journal: Applied Economics, American Economic Association, vol. 3(3), pages 188-220, July.
    30. Escudero, Verónica & Kluve, Jochen & López Mourelo, Elva & Pignatti, Clemente, 2017. "Active labour market programmes in Latin America and the Caribbean: Evicence from a meta analysis," Ruhr Economic Papers 715, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    31. Jonathan M.V. Davis & Sara B. Heller, 2017. "Using Causal Forests to Predict Treatment Heterogeneity: An Application to Summer Jobs," American Economic Review, American Economic Association, vol. 107(5), pages 546-550, May.
    32. Zvi Eckstein & Kenneth I. Wolpin, 1999. "Why Youths Drop Out of High School: The Impact of Preferences, Opportunities, and Abilities," Econometrica, Econometric Society, vol. 67(6), pages 1295-1340, November.
    33. Amanda Pallais, 2014. "Inefficient Hiring in Entry-Level Labor Markets," American Economic Review, American Economic Association, vol. 104(11), pages 3565-3599, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Demir, Gökay & Sandner, Malte & Hertweck, Friederike & Yükselen, Ipek, 2023. "Students' Coworker Networks and Labor Market Entry," VfS Annual Conference 2023 (Regensburg): Growth and the "sociale Frage" 277580, Verein für Socialpolitik / German Economic Association.
    2. Kroupova, Katerina & Havranek, Tomas & Irsova, Zuzana, 2024. "Student Employment and Education: A Meta-Analysis," Economics of Education Review, Elsevier, vol. 100(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Le Barbanchon, Thomas & Ubfal, Diego & Araya, Federico, 2020. "The Effects of Working While in School: Evidence from Uruguayan Lotteries," IZA Discussion Papers 13929, Institute of Labor Economics (IZA).
    2. Livia Alfonsi & Oriana Bandiera & Vittorio Bassi & Robin Burgess & Imran Rasul & Munshi Sulaiman & Anna Vitali, 2020. "Tackling Youth Unemployment: Evidence From a Labor Market Experiment in Uganda," Econometrica, Econometric Society, vol. 88(6), pages 2369-2414, November.
    3. Das, Narayan, 2021. "Training the disadvantaged youth and labor market outcomes: Evidence from Bangladesh," Journal of Development Economics, Elsevier, vol. 149(C).
    4. Acevedo, Paloma & Cruces, Guillermo & Gertler, Paul & Martinez, Sebastian, 2020. "How vocational education made women better off but left men behind," Labour Economics, Elsevier, vol. 65(C).
    5. Emily A. Beam & Stella Quimbo, 2023. "The Impact of Short-Term Employment for Low-Income Youth: Experimental Evidence from the Philippines," The Review of Economics and Statistics, MIT Press, vol. 105(6), pages 1379-1393, November.
    6. Vittorio Bassi & Aisha Nansamba, 2022. "Screening and Signalling Non-Cognitive Skills: Experimental Evidence from Uganda," The Economic Journal, Royal Economic Society, vol. 132(642), pages 471-511.
    7. Laurel Wheeler & Robert Garlick & Eric Johnson & Patrick Shaw & Marissa Gargano, 2022. "LinkedIn(to) Job Opportunities: Experimental Evidence from Job Readiness Training," American Economic Journal: Applied Economics, American Economic Association, vol. 14(2), pages 101-125, April.
    8. Chakravarty, Shubha & Lundberg, Mattias & Nikolov, Plamen & Zenker, Juliane, 2019. "Vocational training programs and youth labor market outcomes: Evidence from Nepal," Journal of Development Economics, Elsevier, vol. 136(C), pages 71-110.
    9. Girum Abebe & A Stefano Caria & Marcel Fafchamps & Paolo Falco & Simon Franklin & Simon Quinn, 2021. "Anonymity or Distance? Job Search and Labour Market Exclusion in a Growing African City [Endogenous Stratification in Randomized Experiments]," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 88(3), pages 1279-1310.
    10. By Stijn Baert & Brecht Neyt & Eddy Omey & Dieter Verhaest, 2022. "Student work during secondary education, educational achievement, and later employment: a dynamic approach," Empirical Economics, Springer, vol. 63(3), pages 1605-1635, September.
    11. Achyuta Adhvaryu & Anant Nyshadham & Jorge A. Tamayo, 2019. "Managerial Quality and Productivity Dynamics," NBER Working Papers 25852, National Bureau of Economic Research, Inc.
    12. Santiago Caicedo & Miguel Espinosa & Arthur Seibold, 2022. "Unwilling to Train?—Firm Responses to the Colombian Apprenticeship Regulation," Econometrica, Econometric Society, vol. 90(2), pages 507-550, March.
    13. Chakravarty, Shubha & Lundberg, Mattias & Nikolov, Plamen & Zenker, Juliane, 2019. "Vocational training programs and youth labor market outcomes: Evidence from Nepal," Journal of Development Economics, Elsevier, vol. 136(C), pages 71-110.
    14. Chen, Xuan & Flores, Carlos A. & Flores-Lagunes, Alfonso, 2015. "Going Beyond LATE: Bounding Average Treatment Effects of Job Corps Training," IZA Discussion Papers 9511, Institute of Labor Economics (IZA).
    15. Achyuta Adhvaryu & Namrata Kala & Anant Nyshadham, 2018. "The Skills to Pay the Bills: Returns to On-the-job Soft Skills Training," NBER Working Papers 24313, National Bureau of Economic Research, Inc.
    16. Omar Al-Ubaydli & John List & Claire Mackevicius & Min Sok Lee & Dana Suskind, 2019. "How Can Experiments Play a Greater Role in Public Policy? 12 Proposals from an Economic Model of Scaling," Artefactual Field Experiments 00679, The Field Experiments Website.
    17. Martin Abel & Rulof Burger & Patrizio Piraino, 2017. "The value of reference letters," Working Papers 06/2017, Stellenbosch University, Department of Economics.
    18. André Dumas Tsambou & Lionie Mafang & Thierno Malick Diallo & Benjamin Fomba Kamga, 2024. "Impact of job training program on employment outcomes in Senegal," SN Business & Economics, Springer, vol. 4(8), pages 1-33, August.
    19. Bhaskar Chakravorty & Arjun S. Bedi, 2019. "Skills Training and Employment Outcomes in Rural Bihar," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 62(2), pages 173-199, June.
    20. Lesner, Rune Vammen & Damm, Anna Piil & Bertelsen, Preben & Pedersen, Mads Uffe, 2022. "The Effect of School-Year Employment on Cognitive Skills, Risky Behavior, and Educational Achievement," Economics of Education Review, Elsevier, vol. 88(C).

    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejapp:v:15:y:2023:i:1:p:383-410. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.