Financial Incentives for Steering Education and Training

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The present report examines how governments use financial incentives to promote a better alignment between labour market needs, on the one hand, and the supply of skills, on the other. In doing so, it identifies: i) innovative models that countries may be interested in learning from; ii) best practice in the design and use of financial incentives; iii) framework conditions for their effective use; and iv) limitations and risks in the use of financial incentives.


Financial incentives for steering education and training

This chapter documents the use of financial incentives for steering education and training in OECD and non-OECD EU countries, providing a wealth of country examples. Following a simple taxonomy, financial incentives are classified into supplyand demand-side measures, with a further breakdown of the latter into measures targeted at individuals and those targeted at employers. Although this taxonomy is attractive, it is not always straightforward to classify measures neatly given that demand- and supply-side effects are closely intertwined. In addition, many programmes offer more comprehensive solutions which target skills supply and demand simultaneously.


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