The Puzzle of Non-Participation in Continuing Training – An Empirical Study of Permanent vs. Occasional Non-Participation
AbstractAlthough participation in continuing vocational training is often found to be associated with considerable individual benefits, a puzzlingly large number of people still do not take part in training. We argue that in order to solve the puzzle it is important to take selection effects into account when studying the returns to education. It has already been established that training participants and non-participants differ in unobservable charac-teristics and therefore self-select into training or not. We show that even non-participants cannot be treated as a homogeneous group: there are individuals who never take part in training (permanent non-participants) and individuals currently not taking part (occasional non-participants). Using a unique data set of non-participants we sepa-rate and compare those two groups. We find that, if they participated, permanent non-participants would have higher costs than occasional non-participants and the benefits associated with their current jobs would be lower. However, even permanent non-participants would benefit from participation in terms of improved prospects on the la-bor market. The results indicate that permanent non-participants either misperceive fu-ture developments or suffer from an exceptionally high discount rate, which in turn leads in their view to a negative cost-benefit ratio for training.
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Bibliographic InfoPaper provided by University of Zurich, Institute for Strategy and Business Economics (ISU) in its series Working Papers with number 0058.
Length: 46 pages
Date of creation: Aug 2006
Date of revision:
Further training; Investing in human capital; Costs-benefit ratio;
Other versions of this item:
- Uschi Backes-Gellner & Johannes Mure & Simone Tuor, 2006. "The Puzzle of Non-Participation in Continuing Training – An Empirical Study of Permanent vs. Occasional Non-Participation," Economics of Education Working Paper Series 0004, University of Zurich, Institute for Strategy and Business Economics (ISU).
- M5 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics
- M12 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Personnel Management; Executives; Executive Compensation
- M53 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Training
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