Market imperfections and firm-sponsored training

M. Picchio, J.C. van Ours

Research output: Contribution to journalArticleScientificpeer-review

23 Citations (Scopus)


Using worker and firm data from Dutch manufacturing, our paper investigates how product market competition and labor market imperfections affect firm-sponsored training. We find that product market competition does not affect the firms' training expenditures. Increasing competition, for instance due to increased international integration and globalization, is not a threat to investments in on-the-job training. Instead, labor market imperfections influence firm-sponsored training. An increase in labor market flexibility significantly reduces the incentives of firms to invest in training. The magnitude of this effect is nevertheless small.
Original languageEnglish
Pages (from-to)712-722
JournalLabour Economics
Issue number5
Publication statusPublished - 2011


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