We thank an editor and an anonymous referee for helpful comments. Financial support from the Deutsche Forschungsgemeinschaft (DFG) is gratefully acknowledged. The authors also thank the German Federal Employment Agency (BA) and the Institute for Employment Research (IAB) for providing the data. Any data or computational errors in this paper are our own.
Profit Sharing and Training*
Article first published online: 3 JUL 2012
© 2012 The Department of Economics, University of Oxford and John Wiley & Sons Ltd
Oxford Bulletin of Economics and Statistics
Volume 75, Issue 6, pages 940–961, December 2013
How to Cite
Kraft, K. and Lang, J. (2013), Profit Sharing and Training. Oxford Bulletin of Economics and Statistics, 75: 940–961. doi: 10.1111/j.1468-0084.2012.00714.x
- Issue published online: 21 NOV 2013
- Article first published online: 3 JUL 2012
- Final Manuscript Received: May 2012
- Deutsche Forschungsgemeinschaft (DFG)
We analyze the impact of profit sharing on training intensity. Profit sharing may affect training because it is a credible commitment by firms to reward firm-specific skills, may reduce turnover and leads to peer group pressure to participate in training courses. To eliminate possible selectivity effects, we combine matching with difference-in-differences. We identify the proportion of employees participating in profits and differentiate profit sharing according to the percentage of the workers covered. Using German establishment data we find that profit sharing only has a significant effect on training intensity if the majority of the workforce benefits from it.