Training Subsidies and the Wage Returns to Continuing Vocational Training: Evidence from Italian Regions
AbstractWe use the variation of training policy over time and across Italian regions to identify the relationship between individual training and earnings. Using longitudinal data for the period 1999 to 2005, we find that the marginal effect of one additional week of formal training on monthly earnings is 4.4 percent. This effect declines rapidly over time and is equal to 0.86 percent 10 years after the investment. We also find that marginal returns are higher among small firms, which are more likely to be constrained by lack of economic resources in their training decisions. Since small firms train less than large firms, their higher returns from the training induced by training policies can simply reflect decreasing marginal returns to training.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4861.
Length: 44 pages
Date of creation: Apr 2010
Date of revision:
Publication status: published in: Labour Economics, 2012, 19 (3), 361-372
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- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
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