Vocational school graduates enjoy a higher employment probability than other types of graduates across industrial economies. This may result from either the signaling effects of vocational school degrees or skill complementarity between vocational schooling and work experience. Regarding wage...

Employers use educational background as a signal of a workerfs latent ability. This signaling effect decreases as employers learn about the workerfs ability with his/her work experience, which results in negative coefficient of interaction term between schooling and experience in wage equation....