The Impact of Training on Productivity and Wages: Firm Level Evidence

Konings, Jozef; Vanormelingen, Stijn

doi:10.2139/ssrn.1487468

The Impact of Training on Productivity and Wages: Firm Level Evidence

LICOS Discussion Paper No. 244/2009

48 Pages Posted: 18 Oct 2009

See all articles by Jozef Konings

Jozef Konings

Catholic University of Leuven (KUL) - LICOS - Centrum voor Transitie-economie; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Stijn Vanormelingen

Hogeschool-Universiteit Brussel (HUBrussel); KU Leuven - Centre for Institutions and Economic Performance (LICOS)

There are 3 versions of this paper

Date Written: August 2009

Abstract

This paper uses firm level panel data of firm provided training to estimate its impact on productivity and wages. To this end the strategy proposed by Ackerberg, Caves and Frazer (2006) for estimating production functions to control for the endogeneity of input factors and training is applied. The productivity premium for a trained worker is estimated at 23%, while the wage premium of training is estimated at 12%. Our results give support to recent theories that explain work related training by imperfect competition in the labor market.

Keywords: Training, production functions, human capital

JEL Classification: J24, J31, L22

Suggested Citation: Suggested Citation

Konings, Jozef and Vanormelingen, Stijn, The Impact of Training on Productivity and Wages: Firm Level Evidence (August 2009). LICOS Discussion Paper No. 244/2009, Available at SSRN: https://ssrn.com/abstract=1487468 or http://dx.doi.org/10.2139/ssrn.1487468