Estimating the effect of state dependence in work-related training participation among British employees

Panos Sousounis ()
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Panos Sousounis: Department of Economics, University of the West of England

No 920, Working Papers from Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol

Abstract: Despite the extensive empirical literature documenting the determinants of training participation and a broad consensus on the influence of previous educational attainment on the training participation decision, there is hardly any reference in the applied literature to the role of past experience of training on future participation. This paper presents evidence on the influence of serial persistence in the work-related training participation decision of British employees. Training participation is modelled as a dynamic random effects probit model and estimated using three different approaches proposed in the literature for tackling the initial conditions problem by Heckman (1981), Wooldrgidge (2005) and Orme (2001). The estimates are then compared with those from a dynamic limited probability model using GMM techniques, namely the estimators proposed by Arellano and Bond (1991) and Blundell and Bond (1998). The results suggest a strong state dependence effect, which is robust across estimation methods, rendering previous experience as an important determining factor in employees’ work-related training decision.

Keywords: state dependence; unobserved heterogeneity; training; dynamic panel data models; generalised method of moments (search for similar items in EconPapers)
JEL-codes: C23 C25 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2009-10
New Economics Papers: this item is included in nep-lab
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