The Impact of Training on Productivity and Wages. Evidence from Belgian Firm Level Panel Data
AbstractThis paper uses longitudinal data of more than 13,000 firms to analyze the effects of on-the-job training on firm level productivity and wages. Workers receiving training are on average more productive than workers not receiving training. This makes firms more productive. On-the-job training increases firm level measured productivity between 1 and 2%, compared to firms that do not provide training. The effect of training on wages is also positive, but much lower than the effect on productivity. Average wages increase only by 0.5%. Sectoral spillovers between firms that train workers are found, but only in firms active in the manufacturing sector. In non-manufacturing no spillovers seem to take place. The results are consistent with recent theories that explain on-the-job training, related to imperfect competition in the labor market, such as monopsony and union bargaining.
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Bibliographic InfoPaper provided by LICOS - Centre for Institutions and Economic Performance, KU Leuven in its series LICOS Discussion Papers with number 19708.
Date of creation: 2008
Date of revision:
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More information through EDIRC
on-the-job-training; productivity; firm level data; monopsony;
Find related papers by JEL classification:
- J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
- M53 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Training
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-01-12 (All new papers)
- NEP-BEC-2008-01-12 (Business Economics)
- NEP-EFF-2008-01-12 (Efficiency & Productivity)
- NEP-LAB-2008-01-12 (Labour Economics)
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