XClose

Economics

Home
Menu

Vittorio Bassi

I am an applied microeconomist, with primary research interests in Development Economics and Labor Economics. In my current work, I focus on the role of information and training in labor markets in low income countries.

In my job market paper, I study how lack of information on the skills of workers affects both employers and job seekers. I do so by designing and implementing a field experiment in the Ugandan labor market: through the provision of certifications, I vary whether new information on the soft skills of workers is disclosed to both managers and workers during job interviews. I examine the reaction of both firms and workers to the information, and show how this affects the propensity of firms to hire, the allocation of jobs to workers with different skills, and overall welfare in the labor market.

In other research, I combine the use of field experiments and structural econometric models to evaluate the effectiveness of three active labor market policies – formal vocational training, informal on-the-job training, and firm-worker matching – in improving the labor market outcomes of disadvantaged youth, and in reducing the constraints to expansion for small firms in Uganda.

  • Development Economics
  • Labor Economics
  • Personnel Economics

Information Frictions in the Labor Market: Evidence from a Field Experiment in Uganda

Abstract

We study how lack of information on the skills of workers affects both employers and job seekers. To do so, we design and implement a field experiment in the Ugandan labor market: through the provision of certifications, we vary whether new information on the soft skills of workers is disclosed to both managers and workers during job interviews. We show that both sides of the market react to the information: managers of higher ability update their beliefs on worker's skills, while workers with higher skills revise their outside options upwards. Guided by these facts, we develop a screening model with two-sided updating. The model predicts non-linear impacts of the certifications on job offers and hires along the skill distribution, due to differential effects on worker's outside options. In line with these predictions, we find the largest employment gains for workers in the middle of the skill distribution. Our estimates of the Internal Rate of Return (IRR) of the intervention range between 9-29%, implying positive welfare gains for the average participant. Motivated by the heterogeneous impacts, we use the model to determine the welfare effects of introducing a mandatory certification policy on soft skills across the entire skill distribution.

  • Professor Imran Rasul
  • Professor Richard Blundell
  • Professor Costas Meghir