Description:
This paper examines the relationship
between the type of senior high school attended by
Indonesian youth and their subsequent labor market outcomes.
This topic is very timely, given the government s recent
decision to dramatically expand vocational enrollment. The
analysis controls for an unusually rich set of predetermined
characteristics, and exploits longitudinal data spanning 14
years to separately identify cohort and age effects. There
are four main findings. First, students are sorted into
different school types largely on the basis of their
entering exam score. Public schools attract the
highest-scoring students, while private vocational schools
serve the lowest-scoring students. Second, after controlling
for a variety of characteristics, including test scores,
male public school graduates earn a substantial premium over
their privately schooled counterparts. Third, private
vocational school graduates fare at least as well as private
general graduates, despite coming from more disadvantaged
socioeconomic backgrounds. Finally, the returns to public
vocational education have declined sharply for the most
recent cohort of men. This raises important concerns about
the current expansion of public vocational education, and
the relevance of the male vocational curriculum in an
increasingly service-oriented economy.