Evaluation design
The impact evaluation sought to identify the causal impact of exposure to equipment upgrades on subsequent outcomes. Insofar as we were not able to randomly assign upgraded equipment across schools or trades, we could not estimate the impact of exposure to equipment upgrades directly. However, the gradual rollout of equipment upgrades to TVET schools over time implied that individuals in later cohorts studying trades affected by equipment upgrades were exposed to these upgrades for longer than individuals in earlier cohorts. Taking advantage of this gradual rollout, we proceeded to estimate the impact of exposure to upgraded equipment in three steps: First, we randomly assigned applicants to trades in 10 TVET schools that were generally oversubscribed, receiving more applicants than they could accommodate each year. This enabled us to estimate the causal impact of admission to trades affected by equipment upgrades for the 2010, 2011, and 2012 admission cohorts. Then we compared the impact of admission to trades affected by upgrades on outcomes in earlier and later cohorts to estimate the impact of exposure to upgrades.
The random assignment of applicants to trades in 10 TVET schools also enables us to evaluate the impact of admission to a TVET school which is important for assessing the value of technical and vocational education in Mongolia. Therefore, this evaluation is focused both on the impact of exposure to equipment upgrades and the impact of admission to a TVET school.
Findings
We find that admission to oversubscribed TVET schools leads to significant improvements in employment and earnings, especially for women. These improvements are likely due to the acquisition of more skills in specific trades, greater work intensity, and increased employment opportunities in high-paying sectors. These findings are consistent with the presence of a shortage of vocational students in Mongolia--one of the key assumptions underpinning the choice of the TVET sector as a focus of the Mongolia Compact. Moreover, they suggest that expanding access to TVET schools would have large benefits for prospective students, and for women in particular.
We do not find evidence for positive impacts of exposure to upgraded equipment on employment or earnings. There is also no evidence for impacts on intermediate or other outcomes. Why do we not find positive impacts from exposure to upgraded equipment? One possible explanation is that labor market opportunities for those who studied upgraded or improved trades deteriorated relative to those who studied other trades. Indeed, there is some evidence for a general deterioration of labor market opportunities for individuals admitted to TVET schools in the 2012 cohort. Unfortunately, since we were not able to randomly assign upgraded equipment across schools or trades, we cannot rule out these alternative explanations for the absence of positive impacts. Future evaluations should heed the challenges inherent in research designs that do not rely solely on random assignment.