An analysis of the effect of reserve participation and training on civilian employment and earnings

Abstract

Utilizing data from the 1986 Reserve Components Surveys, this thesis implements a test of the hypothesis that a positive relationship exists between occupational training received in the reserves and increased benefits and wages on reservists' civilian jobs. The null hypothesis was that no such relationship exists, or that it exists for relatively few reservists, so that reserve participation is mainly a form of moonlighting with few spillover benefits to the individual or society in the form of increased worker productivity. Log-earnings regression equations were specified to test the basic hypothesis. The two-stage least squares (2SLS) estimating technique was utilized to estimate the models due to the existence of simultaneity bias in the regression equations. It was determined that affiliating with the reserves to receive training results in an increase in civilian benefits and wages. Therefore the null hypothesis was rejected, leading to the conclusion that reserve training does appear to provide important benefits to some enlistees, namely those who are motivated to seek skill training that can be used on their civilian job or used to find a better civilian job.