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Who benefits from training and R&D: The firm or the workers? A study on panels of French and Swedish firms

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Author Info
Gérard Ballot () (ERMES, Université Paris II,)
Fathi Fakhfakh (ERMES, Université Paris II,)
Erol Taymaz () (Department of Economics, METU)

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Abstract

The present paper offers a novel study of the effects of intangible assets on wages and productivity. Training, R&D, and physical capital are all taken into account, and their joint effects examined. We use panels of firms in order to control for unobserved fixed effects and the potential endogeneity of training and R&D, and have been able to obtain data for two different countries, France and Sweden, in order to explore the effects of institutional or national specificity. The estimation of productivity and wage equations allows us to show how the benefits of investment in physical capital, R&D and training are shared between the firm and the workers. Although the workers obtain significant benefits, the study shows that the firm obtains the largest return on the investments it makes. This is true not only for physical capital and R&D, but also for training. It suggests that firms can rationally invest in training and that the issue of under-investment in training should be re-examined.

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File URL: http://www.erc.metu.edu.tr/menu/series02/0201.pdf
File Format: application/pdf
File Function: First version, 2002
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Publisher Info
Paper provided by ERC - Economic Research Center, Middle East Technical University in its series ERC Working Papers with number 0201.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 30 pages
Date of creation: Jan 2002
Date of revision: Jan 2002
Handle: RePEc:met:wpaper:0201

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Web page: http://www.erc.metu.edu.tr
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For technical questions regarding this item, or to correct its listing, contact: (Erol Taymaz).

Related research
Keywords: Training; R&D; productivity; wages;

Find related papers by JEL classification:
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
D24 - Microeconomics - - Production and Organizations - - - Production; Capital and Total Factor Productivity; Capacity
O30 - Economic Development, Technological Change, and Growth - - Technological Change - - - General

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

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    Other versions:
  4. Goux, Dominique & Maurin, Eric, 2000. "Returns to firm-provided training: evidence from French worker-firm matched data1," Labour Economics, Elsevier, vol. 7(1), pages 1-19, January. [Downloadable!] (restricted)
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  7. Van Reenen, John, 1996. "The Creation and Capture of Rents: Wages and Innovation in a Panel of U.K. Companies," The Quarterly Journal of Economics, MIT Press, vol. 111(1), pages 195-226, February. [Downloadable!] (restricted)
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  10. Dearden, Lorraine & Reed, Howard & Van Reenen, John, 2000. "Who Gains when Workers Train? Training and Corporate Productivity in a Panel of British Industries," CEPR Discussion Papers 2486, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  15. 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, ILR School, Cornell University, vol. 46(4), pages 625-636, July.
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  19. Black, Sandra E & Lynch, Lisa M, 1996. "Human-Capital Investments and Productivity," American Economic Review, American Economic Association, vol. 86(2), pages 263-67, May. [Downloadable!] (restricted)
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  24. Daron Acemoglu & Jorn-Steffen Pischke, 1999. "The Structure of Wages and Investment in General Training," Journal of Political Economy, University of Chicago Press, vol. 107(3), pages 539-572, June. [Downloadable!] (restricted)
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  25. Pierre Beret & Arnaud Dupray, 1998. "Valorisation salariale de la formation continue en France et en Allemagne," Post-Print halshs-00006122_v1, HAL. [Downloadable!]
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  27. Groot, Wim, 1999. "Productivity Effects of Enterprise-Related Training," Applied Economics Letters, Taylor and Francis Journals, vol. 6(6), pages 369-71, June. [Downloadable!] (restricted)
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  30. Hellerstein, Judith K & Neumark, David & Troske, Kenneth R, 1999. "Wages, Productivity, and Worker Characteristics: Evidence from Plant-Level Production Functions and Wage Equations," Journal of Labor Economics, University of Chicago Press, vol. 17(3), pages 409-46, July. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. F. Fakhfakh & F. Fitzroy, 2003. "Basic Wages and Firm Characteristics : Rent-sharing in French Manufacturing," Working Papers ERMES 0311, ERMES, University Paris 2. [Downloadable!]
    Other versions:
  2. Kuckulenz, Anja, 2006. "Wage and Productivity Effect of Continuing Training in Germany: A Sectoral Analysis," ZEW Discussion Papers 06-25, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  3. Anja Kuckulenz, 2006. "Wage and Productivity Effect of Continuing Training in Germany : A Sectoral Analysis," Working Papers of the Research Group Heterogenous Labor 06-06, Research Group Heterogeneous Labor, University of Konstanz/ZEW Mannheim. [Downloadable!]
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