Borradores de Economía - Signaling Worker Quality in a Developing Country: Lessons from a Certification Program
La serie Borradores de Economía es una publicación de la Subgerencia de Estudios Económicos del Banco de la República. Los trabajos son de carácter provisional, las opiniones y posibles errores son responsabilidad exclusiva del autor y sus contenidos no comprometen al Banco de la República ni a su Junta Directiva.
The series Borradores de Economía (Working Papers on Economics) contributes to the dissemination and promotion of the work by researchers from the institution. On multiple occasions, these works have been the result of collaborative work with individuals from other national or international institutions. This series is indexed at Research Papers in Economics (RePEc). The opinions contained in this document are the sole responsibility of the author and do not commit Banco de la República or its Board of Directors.
Abstract
We evaluate the returns to signaling occupation-specific skills using unique administrative data from a nationwide certification program in Colombia. The program certifies skills and issues three certificates: basic, intermediate, and advanced. We use regression discontinuity methods to compare workers’ earnings around certificateassignment thresholds. Signaling advanced occupation-specific skills yields significant returns: 9.7% on average within two years of certification. Instead, we find no effects from signaling basic or ntermediate occupation-specific skills. Two mechanisms drive our findings. First, the increase in earnings for salaried workers comes from promotions within a firm. Second, the certificate facilitates transitions from self-employment to salaried work.
26TH OF MARCH, 2024 - 
