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Grupo de Estudos Monetários e Financeiros

Estudos do GEMF, N.º 05 de 2010


Productivity, Wages, and the Returns to Firm-Provided Training:

Fair Shared Capitalism?

(Publicado em International Journal of Manpower 34(7): 776-793, 2013. Artigo selecionado pelo Editorial Team como o "Outstanding Paper of 2013".)

Ana Sofia Lopes
Departamento de Gestão e Economia, ESTG/Instituto Politécnico de Leiria, Portugal, e GEMF

Paulino Teixeira
GEMF/Faculdade de Economia, Universidade de Coimbra, Portugal

In this study, we develop an alternative modelling that examines a) the determinants of firm productivity and wages and b) the internal rate of return (IRR) to firm training for both firms and workers. Using a six-year linked employer-employee dataset, our estimates indicate that an additional hour of training per worker results in an increase of 0.12% in productivity and 0.04% in wages, or an increase of 0.16% and 0.08%, respectively, if one uses firm training as a stock variable. We then find that 82% of the gains in productivity are captured by firms and 18% by workers. Given the training costs, we finally obtain an IRR of 13% for firms and 33% for workers at sample means. Firms are heterogeneous, and we do find that dispersion in the rates of return across firms is high.

JEL Classification: J24, J31, I2

Keywords: Firm-Provided Training, Internal Rate of Return, Human Capital, Productivity, Wages.

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