Colin P. Green is at the Department of Economics, Lancaster University. John S. Heywood is at the Department of Economics, University of Wisconsin-Milwaukee and Birmingham Business School, University of Birmingham.
Profit Sharing, Separation and Training
Article first published online: 1 JUL 2010
© Blackwell Publishing Ltd/London School of Economics 2010
British Journal of Industrial Relations
Volume 49, Issue 4, pages 623–642, December 2011
How to Cite
Green, C. P. and Heywood, J. S. (2011), Profit Sharing, Separation and Training. British Journal of Industrial Relations, 49: 623–642. doi: 10.1111/j.1467-8543.2010.00805.x
- Issue published online: 15 NOV 2011
- Article first published online: 1 JUL 2010
- Final version accepted on 8 April 2010.
Theory presents two broad channels through which profit sharing can increase worker training. First, it directly increases training by alleviating hold-up problems and/or by encouraging co-workers to provide training. Second, it indirectly increases training by reducing worker separation and increasing training investments' amortization period. This article provides the first attempt at separately identifying these two channels. We confirm a strong direct effect, but also identify a weaker, more tenuous indirect effect. This suggests that profit sharing's influence on training is unlikely to operate primarily through its reduction on separations while simultaneously presenting the first evidence confirming the prediction of an indirect causation.