Formal Employee Training Programs and Their Impact on Labor Produc- Tivity: Evidence from a Human Resources Survey
39 Pages Posted: 3 May 2004 Last revised: 10 Apr 2021
Date Written: July 1989
Although economic models of training decisions are framed in terms of a company's calculation of the costs and benefits of such training, empirical work has never been able to test this model directly on company behavior. This paper utilizes a unique database to analyze the determinants of the variation in formal training across businesses and the impact of such training on labor productivity. Major findings are that large businesses, those introducing new technology end those who rely on internal promotions to fill vacancies are more likely to have formal training programs. Formal training is found to have a positive effect on labor productivity.
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