Employer education, agglomeration and workplace training: poaching vs knowledge spillovers

Giuseppe Croce (), Edoardo Di Porto, Emanuela Ghignoni and Andrea Ricci

No 162, Working Papers in Public Economics from Department of Economics and Law, Sapienza University of Roma

Abstract: This paper analyzes the role of the employer in workplace training, a novelty with respect to the literature on this topic. Taking advantage of a unique dataset on Italy, we study how individual employer profile and the agglomeration of employers influence firms’ propensity to invest in training. Our findings show that highly educated employers have a greater propensity to invest in workplace training. Moreover, we are able to capture the effect of employers’ human capital agglomeration on the training decision. We assert that such agglomeration leads to two different alternative scenarios: 1) a poaching effect may prevail, therefore competition among employers induces less propensity to train workers; 2) a positive knowledge spillover effect may prevail leading to a greater propensity to engage in training. We test these two options discovering that in the Italian case, where small businesses are prominent, the first effect is stronger. Several econometrics issues are considered in our empirical strategy: the skewed and bounded nature of the training decision indicator, the endogeneity issues derived from the agglomeration effect as well as the cross section dependence problems affecting standard errors.

Keywords: workplace training; poaching; knowledge spillovers; entrepreneurship cluster, employer’s education, social capital, proximity. (search for similar items in EconPapers)
JEL-codes: J24 O15 O18 R23 (search for similar items in EconPapers)
Pages: 30
Date: 2013-09
New Economics Papers: this item is included in nep-cse, nep-edu, nep-eur, nep-geo, nep-hrm, nep-knm, nep-lab, nep-lma and nep-ure
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