Market Imperfections and Firm-Sponsored Training

No 4988, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Recent human capital theories predict that labor market frictions and product market competition influence firm-sponsored training. Using matched worker-firm data from Dutch manufacturing, our paper empirically assesses the validity of these predictions. We find that a decrease in labor market frictions significantly reduces firms' training expenditures. Instead, product market competition does not have an effect on firm-sponsored training. We conclude that increasing competition through international integration and globalization does not pose a threat to investments in on-the-job training. An increase in labor market flexibility may reduce incentives of firms to invest in training, but the magnitude of this effect is small.

Keywords: matched worker-firm data; firm-sponsored training; labor market frictions; product market competition (search for similar items in EconPapers)
JEL-codes: D43 J24 J42 L22 M53 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2010-06
New Economics Papers: this item is included in nep-hrm, nep-lab and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published - published in: Labour Economics, 2011, 18 (5), 712-722

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https://docs.iza.org/dp4988.pdf (application/pdf)

Related works:
Journal Article: Market imperfections and firm-sponsored training (2011)
Working Paper: Market imperfections and firm-sponsored training (2010)
Working Paper: Market imperfections and firm-sponsored training (2010)
Working Paper: Market Imperfections and Firm-Sponsored Training (2010)
Working Paper: Market Imperfections and Firm-Sponsored Training (2010)
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