This paper uses firm-level panel data of on-the-job training to estimate its impact on productivity and wages. To this end, we apply and extend the control function approach for estimating production functions, which allows us to correct for the endogeneity of input factors and training. We find that the productivity premium of a trained worker is substantially higher compared to the wage premium. Our results are consistent with recent theories that explain work-related training by imperfect competition in the labor market.
Url or DOI
Country
Belgium
Publication Year
2015
Training
On-the-job training
Labour market status
Employed
Funding Source
Other
Outcome Variable
Income/wages
Data Source
Administrative / survey
Evaluation Method
Regression