Publication: Entry and Competition in the Market for Short-Cycle Programs
Loading...
Files in English
194 downloads
Published
2021-06
ISSN
Date
2021-07-01
Author(s)
Editor(s)
Abstract
Short-cycle higher education programs form skilled human capital in two or three years and are eminently oriented to the labor market. While they could play a key role in the upskilling and reskilling of the workforce required for employment recovery after the COVID-19 pandemic, they will only do so if their supply responds fast and nimbly to the skill needs to local labor markets. This paper studies the entry, competition, and turnover of short-cycle higher education programs (SCPs) in Colombia. It documents a large expansion in the number of programs over the past fifteen years and studies the frequency of program entry and exit. It finds that the market for SCPs is more dynamic than the market for bachelor's programs, as it exhibits greater turnover or “churn" of programs, with a significantly higher rate of program entry and exit in a given year. Exploiting data on local productivity and employment by field of study, the paper finds that SCPs are more responsive than bachelor's programs to changes in local labor demand. Among SCP providers, private and non-university institutions respond the most to the local economy. SCP entry is deterred by the presence of competitors and responds to cost considerations, particularly among private institutions. For a given institution, exit and entry decisions are highly correlated within a field of study. While enrollment is sensitive to the number of competitors, institutions differentiate their product by tuition, field, and geographic coverage. Overall, the evidence suggests that SCPs might indeed respond fast and nimbly to the local labor market needs created by the pandemic.
Link to Data Set
Citation
“Carranza, Juan Esteban; Ferreyra, Maria Marta; Gazmuri, Ana; Franco, Andrea. 2021. Entry and Competition in the Market for Short-Cycle Programs. Policy Research Working Paper;No. 9716. © World Bank. http://hdl.handle.net/10986/35887 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Publication Global Poverty Revisited Using 2021 PPPs and New Data on Consumption(Washington, DC: World Bank, 2025-06-05)Recent improvements in survey methodologies have increased measured consumption in many low- and lower-middle-income countries that now collect a more comprehensive measure of household consumption. Faced with such methodological changes, countries have frequently revised upward their national poverty lines to make them appropriate for the new measures of consumption. This in turn affects the World Bank’s global poverty lines when they are periodically revised. The international poverty line, which is based on the typical poverty line in low-income countries, increases by around 40 percent to $3.00 when the more recent national poverty lines as well as the 2021 purchasing power parities are incorporated. The net impact of the changes in international prices, the poverty line, and new survey data (including new data for India) is an increase in global extreme poverty by some 125 million people in 2022, and a significant shift of poverty away from South Asia and toward Sub-Saharan Africa. The changes at higher poverty lines, which are more relevant to middle-income countries, are mixed.Publication The Macroeconomic Implications of Climate Change Impacts and Adaptation Options(Washington, DC: World Bank, 2025-05-29)Estimating the macroeconomic implications of climate change impacts and adaptation options is a topic of intense research. This paper presents a framework in the World Bank's macrostructural model to assess climate-related damages. This approach has been used in many Country Climate and Development Reports, a World Bank diagnostic that identifies priorities to ensure continued development in spite of climate change and climate policy objectives. The methodology captures a set of impact channels through which climate change affects the economy by (1) connecting a set of biophysical models to the macroeconomic model and (2) exploring a set of development and climate scenarios. The paper summarizes the results for five countries, highlighting the sources and magnitudes of their vulnerability --- with estimated gross domestic product losses in 2050 exceeding 10 percent of gross domestic product in some countries and scenarios, although only a small set of impact channels is included. The paper also presents estimates of the macroeconomic gains from sector-level adaptation interventions, considering their upfront costs and avoided climate impacts and finding significant net gross domestic product gains from adaptation opportunities identified in the Country Climate and Development Reports. Finally, the paper discusses the limits of current modeling approaches, and their complementarity with empirical approaches based on historical data series. The integrated modeling approach proposed in this paper can inform policymakers as they make proactive decisions on climate change adaptation and resilience.Publication Gender Gaps in the Performance of Small Firms: Evidence from Urban Peru(Washington, DC: World Bank, 2025-09-23)This paper estimates the gender gap in the performance of firms in Peru using representative data on both formal and informal firms. On average, informal female-led firms have lower sales, labor productivity, and profits compared to their male-led counterparts, with differences more pronounced when controlling for observable determinants of firm performance. However, gender gaps are only significant at the bottom of the performance distribution of informal firms, and these gaps disappear at the top of the distribution of informal firms and for formal firms. Possible explanations for the performance gaps at the bottom of the distribution include the higher likelihood of small, female-led firms being home-based, which is linked to lower profits, and their concentration in less profitable sectors. The paper provides suggestive evidence that household responsibilities play a key role in explaining the gender gap in firm performance among informal firms. Therefore, policies that promote access to care services or foster a more equal distribution of household activities may reduce gender productivity gaps and allow for a more efficient allocation of resources.Publication The Exposure of Workers to Artificial Intelligence in Low- and Middle-Income Countries(Washington, DC: World Bank, 2025-02-05)Research on the labor market implications of artificial intelligence has focused principally on high-income countries. This paper analyzes this issue using microdata from a large set of low- and middle-income countries, applying a measure of potential artificial intelligence occupational exposure to a harmonized set of labor force surveys for 25 countries, covering a population of 3.5 billion people. The approach advances work by using harmonized microdata at the level of individual workers, which allows for a multivariate analysis of factors associated with exposure. Additionally, unlike earlier papers, the paper uses highly detailed (4 digit) occupation codes, which provide a more reliable mapping of artificial intelligence exposure to occupation. Results within countries, show that artificial intelligence exposure is higher for women, urban workers, and those with higher education. Exposure decreases by country income level, with high exposure for just 12 percent of workers in low-income countries and 15 percent of workers in lower-middle-income countries. Furthermore, lack of access to electricity limits effective exposure in low-income countries. These results suggest that for developing countries, and in particular low-income countries, the labor market impacts of artificial intelligence will be more limited than in high-income countries. While greater exposure to artificial intelligence indicates larger potential for future changes in certain occupations, it does not equate to job loss, as it could result in augmentation of worker productivity, automation of some tasks, or both.Publication Geopolitical Risks and Trade(Washington, DC: World Bank, 2025-09-23)This paper studies the impact of geopolitical risks on international trade, using the Geopolitical Risk (GPR) index of Caldara and Iacoviello (2022) and an empirical gravity model. The impact of spikes in geopolitical risk on trade is negative, strong, and heterogeneous across sectors. The findings show that increases in geopolitical risk reduce trade by about 30 to 40 percent. These effects are equivalent to an increase of global tariffs of up to 14 percent. Services trade is most vulnerable to geopolitical risks, followed by agriculture, and the impact on manufacturing trade is moderate. These negative effects are partially mitigated by cultural and geographic proximity, as well as by the presence of trade agreements.
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Labor Market Effects of Short-Cycle Higher Education Programs(World Bank, Washington, DC, 2021-06)This paper estimates the heterogeneous labor market effects of enrolling in higher education short-cycle (SC) programs. Expanding access to these programs might affect the behavior of some students (compliers) in two margins: the expansion margin (students who would not have enrolled in higher education otherwise) and the diversion margin (students who would have enrolled in bachelor’s programs otherwise). These responses are quantified by exploiting local exogenous variation in the supply of higher education institutions (HEIs) facing Colombian high school graduates in an empirical multinomial choice model with several instruments. Estimates indicate that the presence of at least one HEI specialized in SC programs in the vicinity of the student’s high school municipality increases SC enrollment by 3.7–4.5 percentage points (40–50% of the SC enrollment rate). The diversion margin largely drives this effect. For female compliers, enrollment in SC programs increases formal employment relative to the next-best alternative. For male compliers, in contrast, it lowers formal employment and wages. These results should alert policymakers of the unexpected consequences of higher education expansionary policies.Publication The Contribution of Short-Cycle Programs to Student Outcomes(World Bank, Washington, DC, 2020-10)Short-cycle higher education programs (SCPs), lasting two or three years, capture about a quarter of higher education enrollment in the world and can play a key role enhancing workforce skills. This paper estimates the program-level contribution of SCPs to student academic and labor market outcomes, and studies how and why these contributions vary across programs. This paper exploits unique administrative data from Colombia on the universe of students, institutions, and programs to control for a rich set of student, peer, and local choice set characteristics. Results indicate that program-level contributions account for about 60–70 percent of the variation in student-level graduation and labor market outcomes. Estimates show that programs vary greatly in their contributions, across and especially within fields of study. Moreover, the estimated contributions are strongly correlated with program outcomes but not with other commonly used quality measures. Programs contribute more to formal employment and wages when they are longer, have been provided for a longer time, are taught by more specialized institutions, and are offered in larger cities.Publication Raising College Access and Completion(World Bank, Washington, DC, 2020-10)Free college proposals have become increasingly popular in many countries, yet cross-country evidence indicates that higher college subsidies raise enrollment but not graduation rates. To capture the evidence and evaluate proposals, this paper develops and estimates a dynamic model of college enrollment, performance, and graduation. A central piece of the model, student effort, has a direct effect on class completion and an indirect effect mitigating the risk of performing poorly or dropping out. The model is estimated using rich student-level data from Colombia, and multiple free college programs are simulated. Among them, universal free college expands enrollment the most but does not affect graduation rates, thereby helping explain the evidence. Performance-based free college, in contrast, raises graduation rates yet has a smaller enrollment impactPublication At a Crossroads(World Bank, Washington, DC, 2017-05-02)Higher education (HE) has expanded dramatically in Latin America and the Caribbean (LAC) since 2000. While access became more equitable, quality concerns remain. This volume studies the expansion, as well as HE quality, variety and equity in LAC. It investigates the expansion’s demand and supply drivers, and outlines policy implications.Publication Charter School Entry and School Choice(World Bank, Washington, DC, 2015-07)This paper develops and estimates an equilibrium model of charter school entry and school choice. In the model, households choose among public, private, and charter schools, and a regulator authorizes charter entry and mandates charter exit. The model is estimated for Washington, D.C. According to the estimates, charters generate net social gains by providing additional school options, and they benefit non-white, low-income, and middle-school students the most. Further, policies that raise the supply of prospective charter entrants in combination with high authorization standards enhance social welfare.
Users also downloaded
Showing related downloaded files
Publication Argentina Country Climate and Development Report(World Bank, Washington, DC, 2022-11)The Argentina Country Climate and Development Report (CCDR) explores opportunities and identifies trade-offs for aligning Argentina’s growth and poverty reduction policies with its commitments on, and its ability to withstand, climate change. It assesses how the country can: reduce its vulnerability to climate shocks through targeted public and private investments and adequation of social protection. The report also shows how Argentina can seize the benefits of a global decarbonization path to sustain a more robust economic growth through further development of Argentina’s potential for renewable energy, energy efficiency actions, the lithium value chain, as well as climate-smart agriculture (and land use) options. Given Argentina’s context, this CCDR focuses on win-win policies and investments, which have large co-benefits or can contribute to raising the country’s growth while helping to adapt the economy, also considering how human capital actions can accompany a just transition.Publication World Development Report 2006(Washington, DC, 2005)This year’s Word Development Report (WDR), the twenty-eighth, looks at the role of equity in the development process. It defines equity in terms of two basic principles. The first is equal opportunities: that a person’s chances in life should be determined by his or her talents and efforts, rather than by pre-determined circumstances such as race, gender, social or family background. The second principle is the avoidance of extreme deprivation in outcomes, particularly in health, education and consumption levels. This principle thus includes the objective of poverty reduction. The report’s main message is that, in the long run, the pursuit of equity and the pursuit of economic prosperity are complementary. In addition to detailed chapters exploring these and related issues, the Report contains selected data from the World Development Indicators 2005‹an appendix of economic and social data for over 200 countries. This Report offers practical insights for policymakers, executives, scholars, and all those with an interest in economic development.Publication Morocco Economic Update, Winter 2025(Washington, DC: World Bank, 2025-04-03)Despite the drought causing a modest deceleration of overall GDP growth to 3.2 percent, the Moroccan economy has exhibited some encouraging trends in 2024. Non-agricultural growth has accelerated to an estimated 3.8 percent, driven by a revitalized industrial sector and a rebound in gross capital formation. Inflation has dropped below 1 percent, allowing Bank al-Maghrib to begin easing its monetary policy. While rural labor markets remain depressed, the economy has added close to 162,000 jobs in urban areas. Morocco’s external position remains strong overall, with a moderate current account deficit largely financed by growing foreign direct investment inflows, underpinned by solid investor confidence indicators. Despite significant spending pressures, the debt-to-GDP ratio is slowly declining.Publication Europe and Central Asia Economic Update, Fall 2024: Better Education for Stronger Growth(Washington, DC: World Bank, 2024-10-17)Economic growth in Europe and Central Asia (ECA) is likely to moderate from 3.5 percent in 2023 to 3.3 percent this year. This is significantly weaker than the 4.1 percent average growth in 2000-19. Growth this year is driven by expansionary fiscal policies and strong private consumption. External demand is less favorable because of weak economic expansion in major trading partners, like the European Union. Growth is likely to slow further in 2025, mostly because of the easing of expansion in the Russian Federation and Turkiye. This Europe and Central Asia Economic Update calls for a major overhaul of education systems across the region, particularly higher education, to unleash the talent needed to reinvigorate growth and boost convergence with high-income countries. Universities in the region suffer from poor management, outdated curricula, and inadequate funding and infrastructure. A mismatch between graduates' skills and the skills employers are seeking leads to wasted potential and contributes to the region's brain drain. Reversing the decline in the quality of education will require prioritizing improvements in teacher training, updated curricula, and investment in educational infrastructure. In higher education, reforms are needed to consolidate university systems, integrate them with research centers, and provide reskilling opportunities for adult workers.Publication Classroom Assessment to Support Foundational Literacy(Washington, DC: World Bank, 2025-03-21)This document focuses primarily on how classroom assessment activities can measure students’ literacy skills as they progress along a learning trajectory towards reading fluently and with comprehension by the end of primary school grades. The document addresses considerations regarding the design and implementation of early grade reading classroom assessment, provides examples of assessment activities from a variety of countries and contexts, and discusses the importance of incorporating classroom assessment practices into teacher training and professional development opportunities for teachers. The structure of the document is as follows. The first section presents definitions and addresses basic questions on classroom assessment. Section 2 covers the intersection between assessment and early grade reading by discussing how learning assessment can measure early grade reading skills following the reading learning trajectory. Section 3 compares some of the most common early grade literacy assessment tools with respect to the early grade reading skills and developmental phases. Section 4 of the document addresses teacher training considerations in developing, scoring, and using early grade reading assessment. Additional issues in assessing reading skills in the classroom and using assessment results to improve teaching and learning are reviewed in section 5. Throughout the document, country cases are presented to demonstrate how assessment activities can be implemented in the classroom in different contexts.