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Productivity Adjustments and Learning-by-Doing as Human Capital

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  • Jim Bessen

Abstract

This paper measures plant-level productivity gains associated with learning curves across the entire manufacturing sector. We measure these gains at plant startups and also after major employment changes. We find: 1.) The gains are strongly associated with a variety of human capital measures implying that learning-by-doing is largely a firm-specific human capital investment. 2.) This implicit investment is large; many plants invest as much in learning-by-doing as they invest in physical capital and much more than they invest in formal job training. 3.) This investment differs persistently over industries and is higher with greater R&D. 4.) Consistent with a learning-by-doing interpretation, the human capital investment is much larger following employment decreases than increases. We conclude that learning-by-doing is a major factor in wage determination, technical progress and asymmetric employment adjustment costs.

Suggested Citation

  • Jim Bessen, 1997. "Productivity Adjustments and Learning-by-Doing as Human Capital," Working Papers 97-17, Center for Economic Studies, U.S. Census Bureau.
  • Handle: RePEc:cen:wpaper:97-17
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    File URL: https://www2.census.gov/ces/wp/1997/CES-WP-97-17.pdf
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    References listed on IDEAS

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    Cited by:

    1. Mateos-Planas, Xavier, 2000. "Schooling and distortions in a vintage capital model," Discussion Paper Series In Economics And Econometrics 30, Economics Division, School of Social Sciences, University of Southampton.
    2. Mateos-Planas, Xavier, 2000. "Schooling and distortions in a vintage capital model," Discussion Paper Series In Economics And Econometrics 0030, Economics Division, School of Social Sciences, University of Southampton.
    3. Dmitriy Stolyarov & Boyan Jovanovic, 2000. "Optimal Adoption of Complementary Technologies," American Economic Review, American Economic Association, vol. 90(1), pages 15-29, March.
    4. Øivind A. Nilsen & Arvid Raknerud & Marina Rybalka & Terje Skjerpen, 2005. "Lumpy Investments, Factor Adjustments and Productivity," Discussion Papers 441, Statistics Norway, Research Department.
    5. Xavier Mateos-Planas, 2001. "Schooling and Distortions in a Vintage Capital Model," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 4(1), pages 127-158, January.
    6. Øivind A. Nilsen & Arvid Raknerud & Marina Rybalka & Terje Skjerpen, 2009. "Lumpy investments, factor adjustments, and labour productivity," Oxford Economic Papers, Oxford University Press, vol. 61(1), pages 104-127, January.
    7. Boyan Jovanovic, 1998. "Michael Gort's Contribution to Economics," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 1(2), pages 327-337, April.

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    Keywords

    CES; economic; research; micro; data; microdata; chief; economist;

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