Coordinated Markets, School-to-Work Linkages, and Labor Market Outcomes in the European Union
Year: 2020
Type: preprint
Abstract: A large literature in both sociology and political science has theorized about the importance of country differences in skill formation systems for labor market outcomes. Focusing on twenty-one European countries, this paper establishes that countries differ in the strength of the pathways that connect educational credentials to the occupational structure, though there is considerable variability in the country rankings of the strength of individual pathways. Pathway strength matters for the quality of occupational matching, for employment and earnings, and for the earnings gap between well matched and less well-matched workers. In general, the total effects of local linkage strength are to raise earnings and to lower unemployment risk, though positive total effects of local linkage on earnings are concentrated at the lower tertiary and non-tertiary educational levels. Suggestive evidence that pathway effects are stronger in high-linkage countries exists for male and for older female workers, and the results also support the hypothesis that local linkage is more protective against unemployment in high linkage countries. However, consistent differences between high-linkage and low-linkage countries within educational levels are elusive. Thus, while macro-structural effects may be important, the principal difference among countries appears to be in the extent and distribution of pathway strength leading from educational credentials to occupations.
Authors: Thomas Albert DiPrete, Joanna Chae
Institution: Columbia University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W4241900181