The effects of youth labour market reforms: evidence from Italian apprenticeships

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Abstract

In this paper, we estimate the causal effects of the 2003 reforms to the Italian apprenticeship contract that increased its legal length, allowed on-the-job training and introduced a minimum floor to apprentices’ wages. Using administrative data, we implement a covariate balancing propensity score and a difference-in-differences estimator. We find that the new contract improves the chances of an apprentice obtaining a permanent job in the same firm five years after hiring; however, this occurs more frequently in large firms. We also find sizeable, long-run wage effects that extend well beyond the legal duration of the apprenticeship contract. These effects are compatible with increased human capital accumulation, possibly due to the reformed training provisions.
Original languageEnglish
Article numbergpz053
Pages (from-to)98-121
JournalOxford Economic Papers
Volume73
Issue number1
Early online date27 Sep 2019
DOIs
Publication statusPublished - Jan 2021

Keywords

  • labour market
  • Italian apprenticeships
  • youth

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