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Why Do Low-Educated Workers Invest Less in Further Training?

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Author Info

  • Fouarge, Didier

    ()
    (ROA, Maastricht University)

  • Schils, Trudie

    ()
    (Maastricht University)

  • de Grip, Andries

    ()
    (ROA, Maastricht University)

Abstract

Several studies document the fact that low-educated workers participate less often in further training than high-educated workers. The economic literature suggests that there is no significant difference in employer willingness to train low-educated workers, which leaves the question of why the low educated invest less in training unanswered. This paper investigates two possible explanations: Low-educated workers invest less in training because of 1) the lower economic returns to these investments or 2) their lower willingness to participate in training. Controlling for unobserved heterogeneity that can affect the probability of enrolling into training, we find that the economic returns to training for low-educated workers are positive and not significantly different from those for high-educated workers. However, low-educated workers are significantly less willing to participate in training. This lesser willingness to participate in training is driven by economic preferences (future orientation, preference for leisure), as well as personality traits (locus of control, exam anxiety, and openness to experience).

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5180.

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Length: 32 pages
Date of creation: Sep 2010
Date of revision:
Publication status: published in: Applied Economics, 2013, 45 (18), 2587-2601
Handle: RePEc:iza:izadps:dp5180

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Keywords: returns to training; preferences; non-cognitive skills;

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References

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  1. Jorn-Steffen Pischke, 2001. "Continuous training in Germany," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 2473, London School of Economics and Political Science, LSE Library.
  2. James J. Heckman, 1999. "Policies to Foster Human Capital," NBER Working Papers 7288, National Bureau of Economic Research, Inc.
  3. Killingsworth, Mark R, 1982. ""Learning by Doing" and "Investment in Training": A Synthesis of Two "Rival" Models of the Life Cycle," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 49(2), pages 263-71, April.
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  21. Barron, John M & Black, Dan A & Loewenstein, Mark A, 1989. "Job Matching and On-the-Job Training," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 7(1), pages 1-19, January.
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Citations

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Cited by:
  1. Singer, Christine & Toomet, Ott-Siim, 2013. "On government-subsidized training programs for older workers," IAB Discussion Paper 201321, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  2. Görlitz, Katja & Tamm, Marcus, 2012. "Revisiting the Complementarity between Education and Training: The Role of Personality, Working Tasks and Firm Effects," IZA Discussion Papers 6278, Institute for the Study of Labor (IZA).
  3. Antoni, Manfred, 2011. "Lifelong learning inequality? The relevance of family background for on-the-job training," IAB Discussion Paper 201109, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  4. Jorge Calero & Josep-Oriol Escardíbul, 2014. "Barriers to non-formal professional training in Spain in periods of economic growth and crisis. An analysis with special attention to the effect of the previous human capital of workers," Working Papers 2014/12, Institut d'Economia de Barcelona (IEB).
  5. Gerards Ruud & Grip Andries de & Witlox Maaike, 2012. "Employability-miles and worker employability awareness," ROA Research Memorandum, Maastricht University, Research Centre for Education and the Labour Market (ROA) 010, Maastricht University, Research Centre for Education and the Labour Market (ROA).
  6. Aistov, Andrey & Aleksandrova, Ekaterina, 2014. "Individual returns to training: Evidence from Russian firm," Applied Econometrics, Publishing House "SINERGIA PRESS", Publishing House "SINERGIA PRESS", vol. 34(2), pages 56-79.
  7. Judith Offerhaus, 2013. "The Type to Train?: Impacts of Personality Characteristics on Further Training Participation," SOEPpapers on Multidisciplinary Panel Data Research 531, DIW Berlin, The German Socio-Economic Panel (SOEP).
  8. Beblavý, Miroslav & Thum, Anna-Elisabeth & Potjagailo, Galina, 2013. "When do adults learn? A cohort analysis of adult education in Europe," CEPS Papers, Centre for European Policy Studies 8059, Centre for European Policy Studies.
  9. Osiander, Christopher, 2012. "Determinanten der Weiterbildungsbereitschaft gering qualifizierter Arbeitsloser," IAB Discussion Paper 201229, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

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