The Impact of Training on Productivity and Wages: Firm Level Evidence This paper uses firm level panel data of firm provided training to estimate its impact on productivity and wages. To this end the strategy proposed by Ackerberg, Caves and Frazer (2006) for estimating production functions to control for the endogeneity of input factors and training is applied. The productivity premium for a trained worker is estimated at 23%, while the wage premium of training is estimated at 12%. Our results give support to recent theories that explain work related training by imperfect competition in the labor market.JEL Classification: J24, J31 and L22

Abstract:In recent years, Europe has witnessed an accelerated process of economic integration. Trade barriers were removed, the euro was introduced and ten new member states have joined the European Union. This paper analyzes how this process of increased economic integration has affected labor and product markets. To this end, we use a panel of Belgian manufacturing firms to estimate price-cost margins and union bargaining power and show how various measures of globalization affect them.Our findings can be summarized as follows: On average, firms set prices about 30% above marginal costs, but there is substantial variation across sectors, with the lowest mark-up around 19% and the highest around 52%. In addition, we find evidence that unions bargain over both wages and employment. We estimate an index of bargaining power, which reflects the fraction of profits that is passed on to workers into higher wages. Depending on the sector, this fraction varies between 6% and 18% and it increases with the markups of firms. Finally, we find that globalization puts pressure on both markups and union bargaining power, especially when there is increased competition from the low wage countries. This suggests that increased globalization is associated with a moderation of wage claims in unionized countries, which should be associated with positive effects on employment.

This article intends to further unravel the relationship between employee turnover and organizational performance. We test a complex non-linear relationship between turnover and performance, integrating different theoretical views (i.e. theories on human and social capital, operational disruptions and organizational learning) and using polynomial regressions. Based on organizational routines theory, we also consider the role of turnover volatility, i.e. the turbulence in turnover across time. To this end, we make use of longitudinal data of Belgian firms over a period of 10 years (1999-2008). Our results confirm the complex non-linear relationship such that organizations' labor productivity increases at low levels of turnover, reaches a peak and decreases afterwards in a negatively attenuated fashion. Moreover, turnover volatility is negatively associated with labor productivity, suggesting that organizations find it especially difficult to deal with strong and frequent changes in turnover across time. Finally, volatility also moderates the relationship between employee turnover and labor productivity. The higher turnover volatility, the less outspoken the positive results of small amounts of turnover. At high levels of turnover, firms with medium volatility suffer the most negative effects. Both research and practical implications of these findings are considered.

The Impact of Training on Productivity and Wages: Firm Level Evidence This paper uses firm level panel data of firm provided training to estimate its impact on productivity and wages. To this end the strategy proposed by Ackerberg, Caves and Frazer (2006) for estimating production functions to control for the endogeneity of input factors and training is applied. The productivity premium for a trained worker is estimated at 23%, while the wage premium of training is estimated at 12%. Our results give support to recent theories that explain work related training by imperfect competition in the labor market.JEL Classification: J24, J31 and L22

Abstract:In recent years, Europe has witnessed an accelerated process of economic integration. Trade barriers were removed, the euro was introduced and ten new member states have joined the European Union. This paper analyzes how this process of increased economic integration has affected labor and product markets. To this end, we use a panel of Belgian manufacturing firms to estimate price-cost margins and union bargaining power and show how various measures of globalization affect them.Our findings can be summarized as follows: On average, firms set prices about 30% above marginal costs, but there is substantial variation across sectors, with the lowest mark-up around 19% and the highest around 52%. In addition, we find evidence that unions bargain over both wages and employment. We estimate an index of bargaining power, which reflects the fraction of profits that is passed on to workers into higher wages. Depending on the sector, this fraction varies between 6% and 18% and it increases with the markups of firms. Finally, we find that globalization puts pressure on both markups and union bargaining power, especially when there is increased competition from the low wage countries. This suggests that increased globalization is associated with a moderation of wage claims in unionized countries, which should be associated with positive effects on employment.