Heterogeneous Returns to Training in Personal Services
This chapter addresses the earnings impact of continuing training in the personal services sector in Germany. On the one hand the personal services sector is among the sectors with the highest employment growth; on the other hand the share of low-paid workers is higher than in other sectors. While our knowledge of the specific situation of low-paid workers in this sector is limited (Asplund and Salverda, 2004), an obvious way of increasing both productivity and earnings is for firms to increase their investment in employee training (Hughes etal., 2004). The provision of training constitutes a major part of human capital investment (Heckman, 1999). An important proviso, however, is that training increases the earnings of this group of employees. Therefore we not only calculate the average training effect on earnings in the personal services sector, but also differentiate between the wage effects for employees with different qualifications and professional status.
KeywordsInstrumental Variable Personal Service Human Capital Investment Earning Equation Training Participation
Unable to display preview. Download preview PDF.
- Bertschek, I. and A. Spitz (2003) IT, Organizational Change and Wages, ZEW Discussion Paper No. 03–69, (Mannheim: ZEW).Google Scholar
- Booth, A. L., M. Francesconi and G. Zoega (2003) Unions, Work-Related Training, and Wages: Evidence for British Men, IZA Discussion Paper No. 737 (Bonn: IZA).Google Scholar
- Card, D. (1999) ‘The Causal Effect of Education on Earnings’, in O. Ashenfelter and D. Card (eds), Handbook of Labour Economics, vol. 3A (Amsterdam: Elsevier), 1801–63.Google Scholar
- Griliches, Z. and J. Mairesse (1998) ‘Production Functions: The Search for Identification’, in S. Strøm (ed.), Econometrics and Economic Theory in the 20th Century (Cambridge: Cambridge University Press).Google Scholar
- Institut der deutschen Wirtschaft (2002) Deutschland in Zahlen (Cologne: Institut der deutschen Wirtschaft).Google Scholar
- Kuckulenz, A. and T. Zwick (2003) The Impact of Training on Earnings – Differences Between Participant Groups and Training Forms, ZEW Discussion Paper No. 03-57 (Mannheim: ZEW).Google Scholar
- Lynch, L. M. (1992) ‘Private-Sector Training and the Earnings of Young Workers’, The American Economic Review, 82 (1), 299–321.Google Scholar
- Mincer, J. (1974) Schooling, Experience and Earnings (New York: NBER).Google Scholar
- OECD (1999) Employment Outlook (Paris: OECD).Google Scholar
- Wooldridge, J. M. (2002) Econometric Analysis of Cross Section and Panel Data (Cambridge, Mass.: MIT Press).Google Scholar