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Wage Returns of Company Training - Evidence from a Comparison Group Approach

Author

Listed:
  • Christiane Hinerasky

    () (University of Paderborn)

  • Rene Fahr

    () (University of Paderborn)

  • Sabine Simons

    () (Sparkasse KölnBonn)

Abstract

We empirically evaluate wage returns to company training using representative individual-level cross-sectional data for the years 2000, 2003, and 2007. A comparison group approach allows comparing wages of participants with non-participants, who were willing to participate in training, yet were restrained out of random reasons. For training participants, we identify a 7.5% wage premium compared to non-participants, which vanishes once the comparison group is restricted to employees enrolled for training who finally declined participation. The results indicate that typically measured returns to training programs may in fact be returns to unobserved characteristics such as innate ability, personality or cognitive and non-cognitive skills.

Suggested Citation

  • Christiane Hinerasky & Rene Fahr & Sabine Simons, 2014. "Wage Returns of Company Training - Evidence from a Comparison Group Approach," Working Papers Dissertations 17, Paderborn University, Faculty of Business Administration and Economics.
  • Handle: RePEc:pdn:dispap:17
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    File URL: http://groups.uni-paderborn.de/wp-wiwi/RePEc/pdf/dispap/DP17.pdf
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    References listed on IDEAS

    as
    1. 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.
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    3. Carla Haelermans & Lex Borghans, 2012. "Wage Effects of On-the-Job Training: A Meta-Analysis," British Journal of Industrial Relations, London School of Economics, vol. 50(3), pages 502-528, September.
    4. Fahr, Rene, 2005. "Loafing or learning?--the demand for informal education," European Economic Review, Elsevier, vol. 49(1), pages 75-98, January.
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    6. Didier Fouarge & Trudie Schils & Andries de Grip, 2013. "Why do low-educated workers invest less in further training?," Applied Economics, Taylor & Francis Journals, vol. 45(18), pages 2587-2601, June.
    7. Görlitz, Katja & Tamm, Marcus, 2011. "Revisiting the Complementarity between Education and Training – The Role of Personality, Working Tasks and Firm Effects," Ruhr Economic Papers 307, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
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    12. Büchel, Felix & Pannenberg, Markus, 2004. "Berufliche Weiterbildung in West- und Ostdeutschland : Teilnehmer, Struktur und individueller Ertrag (Further vocational training in western and eastern Germany * participants, structure and individua," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 37(2), pages 73-126.
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    14. Grit Muehler & Michael Beckmann & Bernd Schauenberg, 2007. "The returns to continuous training in Germany: new evidence from propensity score matching estimators," Review of Managerial Science, Springer, vol. 1(3), pages 209-235, November.
    15. Edwin Leuven & Hessel Oosterbeek, 2008. "An alternative approach to estimate the wage returns to private-sector training," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 23(4), pages 423-434.
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    Cited by:

    1. Christiane Hinerasky, 2014. "Advances in Training Evaluation - Psychological, Educational, Economic, and Econometric Perspectives on the Kirkpatrick Model," Working Papers Dissertations 14, Paderborn University, Faculty of Business Administration and Economics.

    More about this item

    Keywords

    Company Training; Wage Returns; Evaluation; Berichtssystem Weiterbildung;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training

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