Evaluation of the Australian Wage Subsidy Special Youth ...

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88 participant, were excluded from the employment equation and included in the participation equation. Additionally, some variables such as marital status were 1984 dated in the participation equation but updated to 1985/6 values for the employment equation. Employment was any non-subsidised post-programme period employment. Additional variables that were included in both the SYETP and employment models were sex, children in 1984, children interacted with sex, ethnicity, State of residence in 1984, marital status, education: school type, year left school, post-school qualifications; initial labour market experience: duration of longest job to 1984 reference period; past programme participation, pre-programme unemployment in the year to reference period, health problems affecting work, attitude to women working and attitude interacted with sex, parental education and occupation, number of siblings, English skills, spousal employment in 1984, parental education and occupation, religion, urban/rural/overseas residence before aged 14. The bivariate probit results gave a negative correlation coefficient and Wald tests of the correlation coefficient rejected the hypothesis that the errors of the employment and participation equations were uncorrelated. The comparison for the bivariate probit to the univariate probits showed a strong difference in the measured employment effects. The marginal effects of SYETP on post-programme employment were calculated to give positive employment effects of SYETP participants over non-participants of 26 per cent in 1986 and 20 per cent in 1987 (Richardson (1998): 11). To examine retention of subsidised jobs, the modelling was repeated for employment in 1987 and the sample was limited to exclude those in the treatment or comparison groups who were continuously in a job from the 1984/5 reference period until the 1986 interview. It was noted that similar shares of the SYETP and comparison groups were excluded. The results were similar to those found from the first bivariate probit model. The marginal effect calculated for this equation showed again a positive employment effect for SYETP participants over the comparisons of 23.7 per cent (Richardson (1998): 12). Retention was concluded to be important, but not the only source of positive post-programme employment effects for SYETP participants. Table 2.21 summarises the employment effects found for Richardson (1998).
89 Table 2.21 Richardson (1998) Estimated marginal effect of SYETP on employment from bivariate probit modelling effect on employment 1986 effect on employment 1987 All data used 26.4 19.7 Excluding jobs or placements retained to 1986 23.7 Source: Richardson (1998) p22 Table 6, and p12. The Richardson (1998) analysis usefully modelled both the participation in SYETP and the post-programme employment using the Heckman selection method in a bivariate probit. Earlier SYETP evaluations only modelled employment, none modelled participation in SYETP. The modelling included numerous variables that account for individual characteristics. This was by far the largest set of individual characteristics used in modelling the post-programme employment for SYETP. Generally, most of these have been used in the economics literature, if available in the data, to explain employment, education, or programme participation. The wide variety of variables included illustrates the very rich dataset the ALS has to draw on. The inclusion of a wide set of individual characteristics can help demonstrate that all the useful observable characteristics have been controlled for in modelling both the employment and programme participation. However some of the variables, such as religion, are possibly more unusual for describing economic models of employment or programme participation. Although the non-response was briefly examined, the examination was terse. The conclusions about the possible effects of non-response were based on little serious contemplation of non-response. Some earlier SYETP evaluations (Stretton (1984), Baker (1984)) modelled non-response for their observational data and found non-response was a potential problem. Richardson (1998) contains no modelling of non-response, yet the potential for non-response is much higher in a panel constructed from 4 surveys. As for earlier SYETP evaluations, again no treatment for non-response was made, although in the case of Richardson (1998) this was in line with the conclusions whereas for earlier evaluations this was in spite of the conclusions about the existence of a potential nonresponse problem for estimates.
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i Evaluation of the Australian Wage
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v Declaration I hereby declare that
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in method and assumptions. The orth
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3.3 Data and variables used for est
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List of Tables and Figures Figure 1
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Table A2.0b Univariate Probit of pa
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xv Abstract The job subsidy Special
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1 1: Wage subsidy theory and evalua
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3 programs of providing benefits an
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5 The empirical methods used for th
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7 how the outcomes from these metho
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9 employment effect could be mainly
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11 Real Wage Employment Figure 1.1:
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13 are two types of unemployment, s
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15 Real wages are predetermined whe
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17 Vella (1998), Heckman, Lalonde a
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19 Each individual has two potentia
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21 this case, if there was no data
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23 correlation for the error of the
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25 Table 1.3 collects together some
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27 Table 1.3 Brief overview of rece
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29 necessarily brief. Then, the evi
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31 limited applications, such as fo
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33 who participated. It was conclud
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35 term unemployed for over 12 of t
Page 53 and 54: 37 importance of the subsidy second
Page 55 and 56: 39 differences in characteristics t
Page 57 and 58: 41 Matching methods are theoretical
Page 59 and 60: 43 2.2 SYETP implementation As SYET
Page 61 and 62: 45 In July1978, the subsidy was cal
Page 63 and 64: 47 In January 1979, variations were
Page 65 and 66: 49 benefits were paid at a slightly
Page 67 and 68: 51 2.2.3 SYETP operation Earlier re
Page 69 and 70: 53 ceiling constraints’ applied t
Page 71 and 72: 55 Award Conditions for employment
Page 73 and 74: 57 Harris (2001) claims that during
Page 75 and 76: 59 display boards listed details of
Page 77 and 78: 61 restriction was used. If there w
Page 79 and 80: 63 to the end of the 1980’s. An o
Page 81 and 82: 65 for teens overall had risen, emp
Page 83 and 84: 67 for Australia using data from th
Page 85 and 86: 69 training, can provide a form of
Page 87 and 88: 71 employer survey estimates were t
Page 89 and 90: 73 provisions for SYETP and extende
Page 91 and 92: 75 withdrawals occurred at similar
Page 93 and 94: 77 Table 2.17 State usage of progra
Page 95 and 96: 79 2.3.1 Stretton (1982, 1984) 53 S
Page 97 and 98: 81 Stretton attributed the success
Page 99 and 100: 83 included in the employment model
Page 101 and 102: 85 completers. Their argument was t
Page 103: 87 was an issue for the data. Unlik
Page 107 and 108: 91 2.3.5 General discussion Some ge
Page 109 and 110: 93 Controlling for differences in i
Page 111 and 112: 95 taken by a previous researcher a
Page 113 and 114: 97 If employability is assumed to b
Page 115 and 116: 99 suitability of the underlying as
Page 117 and 118: 101 Heckman, Lalonde and Smith (199
Page 119 and 120: 103 effect on employment relative t
Page 121 and 122: 105 Table 3.1, Part A Employment eq
Page 123 and 124: 107 (-1.80) (-1.80) Tradesperson -0
Page 125 and 126: 109 duration of Pre-June 1984 unemp
Page 127 and 128: 111 4: Study 2 Propensity score mat
Page 129 and 130: 113 Propensity score matching provi
Page 131 and 132: 115 4.2 Propensity score matching m
Page 133 and 134: 117 covariates that influence the a
Page 135 and 136: 119 (7) E(Y c | D=1) = E P(X) {E[Y
Page 137 and 138: 121 For CIA to be plausible, a ‘r
Page 139 and 140: 123 employment and programme partic
Page 141 and 142: Highest qualification in 1984 (1.56
Page 143 and 144: 127 4.6 Distribution of the propens
Page 145 and 146: 129 Figure 4.3 Histograms of estima
Page 147 and 148: 131 Table 4.5 Summary statistics fo
Page 149 and 150: 133 Table 4.5, that the variance of
Page 151 and 152: 135 Table 4.6 Matching results, Sin
Page 153 and 154: 137 Table 6.3 using Swedish data wi
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139 matching is the ability to weed
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141 Table 4.7 Matching results, All
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143 the unobserved component. If th
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145 5: Study 3 Attrition and non-re
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147 occur by design, because the mi
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149 (1990) extended and improved th
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151 (10) A* = δ 0 + δ 1 x +δ 2 z
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153 again from September to Novembe
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155 5.5.2 Univariate examination of
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157 lower, the job lengths are only
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159 Work limited by health 1984 0.1
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161 The characteristics of the SYET
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163 para-professional Mother not em
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165 comparison group where the shar
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167 5.5.4 Attrition: natural attrit
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169 both sources that impose change
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171 para-professional Father not em
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173 work in later sections, this su
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175 Table 5.6: Effect of selection/
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177 appropriate to discard these fr
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179 Australia/Tasmania. Amongst tho
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181 Table 5.5a Summary statistics b
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183 5.6.1.2 Effects of the non-resp
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185 3 years + -0.35 -0.47 -0.34 -0.
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187 5.7 Multivariate analysis of ef
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189 proportion of time spent unempl
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191 post-school qualification, and
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193 Generally, those variables foun
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195 longj0 Longest job by 1984 < 1
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197 adopted in order to maintain co
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199 6: Study 4 Weighting to counter
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201 Table 6.1, part A Employment eq
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203 Methodist 0.133 0.261 (0.77) (1
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205 CEP referrals 1984 0.143* 0.128
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207 6.2 Results of weighting the PS
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209 The distribution of the propens
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211 Table 6.3 Weighted probit used
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213 (0.76) Tradesperson mtrad 0.20
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215 Table 6.5 Summary statistics fo
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217 Table 6.7 Matching results, sin
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219 6.3 Discussion The comparison o
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221 the selection into SYETP and th
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223 Heteroskedasticity is a violati
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225 Table 7.1, Part A Employment eq
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227 (1.26) (1.28) (1.16) Mothers oc
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229 Other Post-School qualification
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231 7.1.2 Exclusion restriction in
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233 Finally, the third panel of new
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235 Table 7.2 summary of changes to
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237 schooling that was statisticall
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239 (0.25) (0.21) 3 years + -0.50 -
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241 Table 7.4 Summary of distributi
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243 7.2.2 Propensity score matching
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245 original model, but with the pe
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247 maintained, then the Heckman bi
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249 Table 7.6 Weighted Probit used
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251 Table 7.7 Summary of distributi
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253 8: Summary and Conclusions The
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255 over which it ran, the review m
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257 the Heckman and PSM methods wer
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259 posited that that such sensitiv
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261 Description Derivation and deta
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Appendix 2 Tables 263
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2 years 0.28 0.07 (1.70) (1.70) 3 y
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267 Table A2.0b Univariate Probit o
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269 Religion brought up in (1.52) (
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271 hq9_84 Year 9 of school or less
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273 Table A2.1 Continued Means and
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275 mtrad Tradesperson 0.04 0.04 0.
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277 Year 9 of school or less -0.19
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279 Table A2.3 Probit of SYETP part
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281 (0.22) (0.44) (0.67) (0.89) Tra
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283 Table A2.5a Univariate probit f
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285 Manager/professional/para-profe
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3 years + -0.04 (2.13)* CEP referra
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289 Table A2.6 Part A Employment eq
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291 Table A2.6 Part B Selection/par
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301
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BLMR Bureau of Labour Market Resear
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Fay, R.G. (1996) "Enhancing the eff
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Heckman J.J. and Smith, J. A. (1998
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Lewis, H.G. (1963) "Unionism and re
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Quandt, R. (1972) "A new approach t
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Stromback, M. and Dockery, A. (2000
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