Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/36814
Authors: 
Picchio, Matteo
van Ours, Jan C.
Year of Publication: 
2010
Series/Report no.: 
Discussion paper series // Forschungsinstitut zur Zukunft der Arbeit 4988
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.
Subjects: 
Firm-sponsored training
labor market frictions
product market competition
matched worker-firm data
JEL: 
D43
J24
J42
L22
M53
Document Type: 
Working Paper

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