We use the regional and time variation of training grants in Italy to identify the causal effect of (formal continuing vocational) training on earnings. We estimate log-linear earnings regressions with constant marginal returns to training and find that one additional week of training increases monthly net earnings by 1.36%, substantially less than the 3% or more often found in the literature. Estimated returns vary significantly by firm size, and range from 0.40% in firms with more than 100 employees to 2.51% in smaller firms, the bulk of the Italian private sector. A simple back of the envelope comparison of the marginal costs and benefits of training policy suggests that the latter are higher than the former. © 2012 Elsevier B.V.
Training subsidies and the wage returns to continuing vocational training. Evidence from Italian regions
SONEDDA, Daniela
2012-01-01
Abstract
We use the regional and time variation of training grants in Italy to identify the causal effect of (formal continuing vocational) training on earnings. We estimate log-linear earnings regressions with constant marginal returns to training and find that one additional week of training increases monthly net earnings by 1.36%, substantially less than the 3% or more often found in the literature. Estimated returns vary significantly by firm size, and range from 0.40% in firms with more than 100 employees to 2.51% in smaller firms, the bulk of the Italian private sector. A simple back of the envelope comparison of the marginal costs and benefits of training policy suggests that the latter are higher than the former. © 2012 Elsevier B.V.File | Dimensione | Formato | |
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