Human Capital Spillovers and Economic Performance in the Workplace in 2004: Some British Evidence

36 Pages Posted: 16 May 2007

See all articles by Renuka Metcalfe

Renuka Metcalfe

University of Wales, Swansea

Peter J. Sloane

University of Wales, Swansea; IZA Institute of Labor Economics

Date Written: May 2007

Abstract

This paper considers the impact of education and training on both individual and co-worker pay and establishment performance using the matched employer-employee data in WERS 2004, the panel dataset 1998-2004 and the new Financial Performance Questionnaire. This enables us to assess the impact of workplace education and training using both subjective (managers' assessments) and objective data on productivity, profits and establishment survival. We establish that workplace education and training can have positive impacts on establishment financial performance, survival and growth. In contrast to extant studies, it was found that the square and the interaction between own and co-workers years of training also have a positive and significant impact on hourly pay. We find evidence indicating that establishments with 60% or more of workers trained have a higher establishment performance and also have a powerful impact on the likelihood of establishment survival.

Keywords: human capital, spillovers, education, training, productivity, profitability, establishment survival

JEL Classification: I2, J4

Suggested Citation

Metcalfe, Renuka and Sloane, Peter J., Human Capital Spillovers and Economic Performance in the Workplace in 2004: Some British Evidence (May 2007). IZA Discussion Paper No. 2774, Available at SSRN: https://ssrn.com/abstract=986341 or http://dx.doi.org/10.2139/ssrn.986341

Renuka Metcalfe

University of Wales, Swansea ( email )

Singleton Park
Swansea, Wales SA2 8PP
United Kingdom

HOME PAGE: http://www.swan.ac.uk/welmerc/renukametcalfe.htm

Peter J. Sloane (Contact Author)

University of Wales, Swansea ( email )

Singleton Park
Swansea, Wales SA2 8PP
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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