Does a pint a day affect your child’s pay? The effect of prenatal alcohol exposure on adult outcomes

This article published in March 2008 has been wrtitten by J Peter Nilsson, from the Institute for Labour Market Policy Evaluation (IFAU) in Uppsala (Sweden), and is is about long term (worklife) consequences of exposing babies in utero to alcohol. Interesting.

Abstract
This paper utilizes a Swedish alcohol policy experiment conducted in the late 1960s to identify the impact of prenatal alcohol exposure on educational attainments and labor market outcomes. The experiment started in November 1967 and was prematurely discontinued in July 1968 due to a sharp increase in alcohol consumption in the experimental regions, particularly among youths. Using a difference-in-difference-in-differences strategy we find that around age 30 the cohort in utero during the experiment have substantially reduced educational attainments, lower earnings and higher welfare dependency rates compared to the surrounding cohorts. The results indicate that investments in early-life health may have far reaching effects on economic outcomes later in life.

Is training affecting the employment of those trained, and increasing the wages?

Some people have their doubts, but there is evidence, for example in this study”The aggregate labor market effects of the Swedish knowledge lift program”, written by James Albrecht (Department of Economics, Georgetown University; IZA; IFAU-Uppsala, CESifo), Gerard J. van den Berg (Department of Economics, Free University Amsterdam; IFAU-Uppsala; Tinbergen Institute; CEPR; IZA; IFS) and Susan Vroman (Department of Economics, Georgetown University; IZA; IFAU-Uppsala; CESi7), published by the Swedish institute for Labour Market Evaluation in December 2007.

Abstract
The Swedish adult education program known as the Knowledge Lift (1997-2002) was unprecedented in its size and scope, aiming to raise the skill level of large numbers of low-skill workers. This paper evaluates the potential effects of this program on aggregate labor market outcomes. This is done by calibrating an equilibrium search model with heterogeneous worker skills using pre-program data and then forecasting the program impacts. Our calibrations suggest that the equilibrium treatment effects were positive – wages are predicted to increase, as are the employment rates of the treated. The equilibrium effects magnify the partial effects by a factor 1.5 to 2. This is due to the increase in demand for skills that is triggered by the increase in its supply.

Does education pay on the labour market?

In this article, “The importance of education for the reallocation of labor: Evidence from Swedish linked employer-employee data 1986-2002″ written by Marie Gartell, Ann-Christin Jans, Helena Persson for the Institute of Future studies, we have a clear demonstration of the impact of education on unemployment. I just wish that all our deciders in the US and in Europe read it….

Abstract

Using employer-employee data covering the whole Swedish economy over a uniquely long time period from 1986 to 2002, we examine how job flows and worker flows have been distributed both on an aggregate level and across educa-tional levels. We find that job and worker flows vary by educational level, not only with respect to magnitude and variation, but with respect to direction as well. Our results show that analyses that do not account for the educational level of workers can be very misleading.