The Effects of Enterprise-Related Training in East Germany on Individual Employment and Earnings

The paper studies the returns from enterprise-related continuous vocational training on individual earnings, unemployment probabilities, and other labour market indicators in East Germany after unification. It attempts to solve the intrinsic identification problem of such evaluation problems nonparametrically by using restrictions "produced" by unification as well as by using very informative panel data (GSOEP, 1990-1994). The estimation is performed with nonparametric methods taking account of the panel structure. The results suggest that there are no effects with respect to employment and unemployment probabilities, but that there are large and positive earnings effects.