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Training, wages and employment security: an empirical analysis on European data

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  • Andrea Bassanini

Abstract

Data from the European Community Household Panel (ECHP) are used to assess the effects of employee training on the average wage and employment security of different labour market groups in EU countries. Significant training wage premia are found only in the case of young or highly educated employees. By contrast training appears to have a strong impact on employment security, measured through subjective measures, in the case of both older and low-educated workers. To reconcile this apparent contradiction, one needs to take into account that, as standard in the literature, wage premia are estimated on a truncated sample including only employed workers. Due to downward wage rigidity, those workers who are unable to maintain their productivity are more frequently laid-off - rather than experiencing a wage fall and be retained in employment - and thereby excluded from the sample.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Applied Economics Letters.

Volume (Year): 13 (2006)
Issue (Month): 8 ()
Pages: 523-527

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Handle: RePEc:taf:apeclt:v:13:y:2006:i:8:p:523-527

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  1. Denis FOUGÈRE & Dominique GOUX & Éric MAURIN, 2001. "Formation continue et carrières salariales. Une évaluation sur données individuelles," Annales d'Economie et de Statistique, ENSAE, issue 62, pages 49-69.
  2. Parent, Daniel, 1999. "Wages and Mobility: The Impact of Employer-Provided Training," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 298-317, April.
  3. Andrew Clark & Fabien Postel-Vinay, 2005. "Job Security and Job Protection," CEP Discussion Papers dp0678, Centre for Economic Performance, LSE.
  4. Agell, Jonas & Lommerud, Kjell Erik, 1997. "Minimum wages and the incentives for skill formation," Journal of Public Economics, Elsevier, vol. 64(1), pages 25-40, April.
  5. Alison L. Booth & Mark L. Bryan, 2005. "Testing Some Predictions of Human Capital Theory: New Training Evidence from Britain," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 391-394, May.
  6. Martin, John P. & Grubb, David, 2001. "What works and for whom: a review of OECD countries' experiences with active labour market policies," Working Paper Series 2001:14, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  7. Paul Sicilian & Adam Grossberg, 2001. "Investment in human capital and gender wage differences: evidence from the NLSY," Applied Economics, Taylor & Francis Journals, vol. 33(4), pages 463-471.
  8. Michael Gerfin, 2003. "Firm-sponsored Work-Related Training in Frictional Labour Markets: An empirical analysis for Switzerland," Diskussionsschriften dp0317, Universitaet Bern, Departement Volkswirtschaft.
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Cited by:
  1. Benoit Dostie & Pierre Thomas Léger, 2011. "Firm-Sponsored Classroom Training: is it Worth it for Older Workers ?," Cahiers de recherche 1136, CIRPEE.
  2. Behaghel, L. & Caroli, E. & Roger, M., 2013. "Age Biased Technical and Organisational Change, Training and Employment Prospects of Older Workers," Working papers 431, Banque de France.
  3. Lang, Julia, 2012. "The aims of lifelong learning: Age-related effects of training on wages and job security," Annual Conference 2012 (Goettingen): New Approaches and Challenges for the Labor Market of the 21st Century 62073, Verein für Socialpolitik / German Economic Association.

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