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

Author(s): Jozef Konings and Stijn Vanormelingen

Publication Date: September 2009

Keyword(s): Human Capital, Production Functions and Training

Programme Area(s): Industrial Organization and Labour Economics

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.

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Bibliographic Reference

Konings, J and Vanormelingen, S. 2009. 'The Impact of Training on Productivity and Wages: Firm Level Evidence'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=7473