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Does Training Generally Work? The Returns to In-Company Training

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  • Barrett, Alan

    ()
    (ESRI, Dublin)

  • O'Connell, Philip J.

    ()
    (ESRI, Dublin)

Abstract

This paper applies the familiar theoretical distinction between general and specific training to the empirical task of estimating the returns to in-company training. Using a firm-level dataset which distinguishes between general and specific training, we test for the relative effects of the two types of training on productivity growth. We find that although general training has a statistically positive effect on productivity growth, no such effect is observable for specific training. This positive effect of general training remains when we control for factors such as changes in work organisation and corporate re-structuring, firm size and the initial level of human capital in the enterprise. Moreover, the impact of general training varies positively with the level of capital investment.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 51.

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Length: 34 pages
Date of creation: Aug 1999
Date of revision:
Publication status: published in: Industrial and Labor Relations Review, 2001, 54 (3), 647-662; see IZA Reprints 95/01
Handle: RePEc:iza:izadps:dp51

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Keywords: General training; specific training; productivity growth;

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  1. Lisa M Lynch & Sandra E Black, 2002. "Beyond the Incidence of Training: Evidence from a National Employers Survey," Working Papers, Center for Economic Studies, U.S. Census Bureau 02-05, Center for Economic Studies, U.S. Census Bureau.
  2. Casey Ichniowski & Kathryn Shaw & Giovanna Prennushi, 1995. "The Effects of Human Resource Management Practices on Productivity," NBER Working Papers 5333, National Bureau of Economic Research, Inc.
  3. Harry J. Holzer & Richard Block & Marcus Cheatham & Jack H. Knott, 1993. "Are training subsidies for firms effective? The Michigan experience," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 46(4), pages 625-636, July.
  4. S Black & L Lynch, 1997. "How to Compete: The Impact of Workplace Practices and Information Technology on Productivity," CEP Discussion Papers, Centre for Economic Performance, LSE dp0376, Centre for Economic Performance, LSE.
  5. Lynch, Lisa M, 1992. "Private-Sector Training and the Earnings of Young Workers," American Economic Review, American Economic Association, American Economic Association, vol. 82(1), pages 299-312, March.
  6. Black, Sandra E & Lynch, Lisa M, 1996. "Human-Capital Investments and Productivity," American Economic Review, American Economic Association, American Economic Association, vol. 86(2), pages 263-67, May.
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