The contested implementation of the dual formation in Costa Rica – A model with potential to tackle labour market imperfections?

Abstract: Costa Rica is one of Latin America’s pioneers in terms of steady economic growth, environmental protection, and educational spending. Yet behind this general perception, the country faces structural problems, like high inequality levels and sky-rocketing youth unemployment, indicating rather exclusive development pattern. In order to tackle these challenges, the government places high hopes in the implementation of the German-based ‘dual formation system’. This study aims at understanding the potential of this educational model, which combines school and work-based learning, for the specific case of Costa Rica. A focus is hereby placed on the two most pressing imperfections of the country’s labour market: high youth unemployment and existing skill mismatches. The qualitative data results indicate a two-fold impact of the dual model in Costa Rica: On the one hand, it is perceived to be flexible enough to produce the technicians which are lacking on the labour market, giving evidence for narrowing the existing skill gaps. On the other hand, the interviewed experts doubt it to have the strength to significantly tackle the structural problem of high youth unemployment if the scope of the offered training spots was not significantly increased in the long-term.