IDEAS home Printed from https://ideas.repec.org/p/hub/wpecon/200827.html
   My bibliography  Save this paper

The impact of training effort and training costs on firm productivity

Author

Listed:
  • Van de Wiele, Patsy

    () (Hogeschool-Universiteit Brussel (HUB), Belgium)

Abstract

Recent studies have shown that human resource management practices like training, participation or incentive compensation significantly contribute to firm performance (see e.g. Zwick, 2006; Bartel, 2000; Black and Lynch, 1998; Ichniowski, Shaw and Prennushi, 1997; Huselid, 1995). Although the human capital of the firm is not explicitly shown on the balance sheet, the value of the firm is at least in part driven by the value of the people who run the show. In this era of knowledge and information, continuous education and training of workers and employees is no longer an option but a must for most firms. This paper looks at the possible relation between employer provided training and firm performance for a sample of over 10 000 large Belgian firms. We first estimate a standard Cobb-Douglas production function to assess the firms’ expected performance based on the input of capital and labour. Our results show that the extent to which a firm performs either better or worse than expected, can partly be explained by the relative number of workers or employees that participate in employer provided formal training or education programs. In addition, training costs seem to have an impact as well. However, the effect of the participation rate in training is stronger than the effect of the amount that is spent per person. This implies that targets set by international or local governments should focus first on training participation rather than on training costs in relation to total wages. With this finding, we contribute to this field of research in two ways. First, our data are taken from the published financial statements. This allows us to work with auditor certified information that is available for all firms. Second, we include training costs in the analysis.

Suggested Citation

  • Van de Wiele, Patsy, 2008. "The impact of training effort and training costs on firm productivity," Working Papers 2008/27, Hogeschool-Universiteit Brussel, Faculteit Economie en Management.
  • Handle: RePEc:hub:wpecon:200827
    as

    Download full text from publisher

    File URL: http://lirias.hubrussel.be/handle/123456789/2233
    Download Restriction: no

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hub:wpecon:200827. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sabine Janssens). General contact details of provider: http://edirc.repec.org/data/emhubbe.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.