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Technological change and employer-provided training: Evidence from German establishments

Listed author(s):
  • Ardiana N. Gashi

    (Riinvest University and Riinvest Institute, Prishtina, Kosova)

  • Geoff Pugh

    (Staffordshire University Business School, Stoke-on-Trent, UK)

  • Nick Adnett

    (Staffordshire University Business School, Stoke-on-Trent, UK)

There is a wide range of theoretical and empirical analyses suggesting that technological change has increased the demand for skills. Since training is a mechanism to upgrade workers’ skills, it would be expected that technical progress strengthens the importance of training on account of the requirement for skills to complement new technology. However, the relationship between technical progress and firms’ (employer-funded) continuous training has been little investigated. In our research we address the theoretical gap by building upon existing models from the skillbiased technological change and training literatures. This theoretical platform supports a maintained hypothesis of a positive relationship between training and technological change, which we investigate empirically for Germany using data from the IAB establishment panel. Our empirical findings indicate that in Germany a greater share of workers undergo further/continuing training in establishments subject to technological change. An important issue we raise in our empirical analysis is the possibility of endogeneity/simultaneity between training and technological change.

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File URL: http://repec.business.uzh.ch/RePEc/iso/leadinghouse/0026_lhwpaper.pdf
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Paper provided by University of Zurich, Department of Business Administration (IBW) in its series Economics of Education Working Paper Series with number 0026.

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Length: 32 pages
Date of creation: May 2008
Handle: RePEc:iso:educat:0026
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  1. Daron Acemoglu & Jorn-Steffen Pischke, 1998. "The Structure of Wages and Investment in General Training," NBER Working Papers 6357, National Bureau of Economic Research, Inc.
  2. Jorn-Steffen Pischke, 2001. "Continuous training in Germany," LSE Research Online Documents on Economics 2473, London School of Economics and Political Science, LSE Library.
  3. John M. Abowd & John Haltiwanger & Julia Lane & Kevin L. McKinney & Kristin Sandusky, 2007. "Technology and the Demand for Skill:An Analysis of Within and Between Firm Differences," NBER Working Papers 13043, National Bureau of Economic Research, Inc.
  4. Bassanini, Andrea & Booth, Alison L. & Brunello, Giorgio & De Paola, Maria & Leuven, Edwin, 2005. "Workplace Training in Europe," IZA Discussion Papers 1640, Institute for the Study of Labor (IZA).
  5. Thomas Zwick, 2003. "The Impact of ICT Investment on Establishment Productivity," National Institute Economic Review, National Institute of Economic and Social Research, vol. 184(1), pages 99-110, April.
  6. Stephen Machin & John Van Reenen, 1998. "Technology and Changes in Skill Structure: Evidence from Seven OECD Countries," The Quarterly Journal of Economics, Oxford University Press, vol. 113(4), pages 1215-1244.
  7. Acemoglu, Daron & Pischke, Jorn-Steffen, 1999. "Beyond Becker: Training in Imperfect Labour Markets," Economic Journal, Royal Economic Society, vol. 109(453), pages 112-142, February.
  8. Katz, Eliakim & Ziderman, Adrian, 1990. "Investment in General Training: The Role of Information and Labour Mobility," Economic Journal, Royal Economic Society, vol. 100(403), pages 1147-1158, December.
  9. Daron Acemoglu, 2003. "Cross-Country Inequality Trends," Economic Journal, Royal Economic Society, vol. 113(485), pages 121-149, February.
  10. Zwick, Thomas, 2002. "Continuous Training and Firm Productivity in Germany," ZEW Discussion Papers 02-50, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  11. Wiji Arulampalam & Alison L. Booth & Mark L. Bryan, 2004. "Training in Europe," Journal of the European Economic Association, MIT Press, vol. 2(2-3), pages 346-360, 04/05.
  12. Stephen Machin & Annette Ryan & John Van Reenen, 1996. "Technology and changes in skill structure: Evidence from an international panel of industries," IFS Working Papers W96/06, Institute for Fiscal Studies.
  13. Snower, Dennis J., 1994. "The Low-Skill, Bad-Job Trap," CEPR Discussion Papers 999, C.E.P.R. Discussion Papers.
  14. Stevens, Margaret, 1994. "A Theoretical Model of On-the-Job Training with Imperfect Competition," Oxford Economic Papers, Oxford University Press, vol. 46(4), pages 537-562, October.
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