Evaluation of the Australian Wage Subsidy Special Youth ...

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Table 7.6 shows the results of the new specification of the probit including only these
variables. The estimated coefficients that are statistically significant are compared to
those in the original specification. Age and marital status remain statistically significant
at conventional levels; however partner’s employment loses statistical significance. The
location of Western Australia/Tasmania retains a positive influence on participation. This
is consistent with the administrative data that showed Western Australia to have a much
higher SYETP placement rate than other states [see section 2.2.6]. Qualifications lose
their impact on SYETP participation in the reduced form model, whereas in the original
model year 12 schooling had a positive impact. A longer qualifying spell of
unemployment still has a positive impact, and past experience of a job held for more than
3 years still has a negative impact on SYETP participation. Other city or country town
kept their negative impact on SYETP participation in the reduced model. The only key
change for variables included in both the full and reduced models is that partner’s
employment and highest qualification of year 12 lose statistical significance in the
reduced form.
The predictive power of the probit is 92 per cent. This is the same power as the original
model. Thus the excluded variables do not change the predictive performance of the
probit. This measure of predictive power is only very rough however. Other measures of
fit indicate the reduced specification to be slightly better, with the AIC lower at 0.53
compared to the former models values of 0.56 and 0.57 (note the sample size has
increased as certain variables dropped had missing cases).
The propensity scores, for both SYETP participants and comparisons, from the new
specification are shown in Table 7.7. These are compared to those found earlier [see
section 6.2.2]. This change to the specification has quite a strong impact on the range of
the distribution. Figure 7.8 shows the histograms for the propensities estimated. Both
propensities for SYETP and the comparison group now have a range less than 0.4. The
distributions have been shifted towards zero. The upper tails have generally disappeared,
with the remainder of the distribution shaped similarly to the distribution from the