Job Training Determinants, R&D and Effects on Firms’ Productivity

: evidence from firm-level data in Latin America

Abstract

For many decades, Latin America followed an import-substitution industrialization (ISI) process. Constant technological developments, complex production processes and stronger international competition put in evidence some workforce fragilities, their lack of skills and capabilities. Enhancing investments in both job training and R&D may be a proper reaction for either the more immediate needs or the medium/long run structural demands, in Latin America. Exploring a firm-level dataset from Chile and Argentina, we estimate the firms’ training decision (standard probit model) and the productivity effects through OLS, treatment-effects model and instrumental variable, using industry and region fixed effects and clustered standard errors. Using OLS, training estimates on firms’ performance are 24% in Chile and 18% in Argentina. Joint investment in training and R&D leads job training to have an effect of 53% in Chile and 22% in Argentina, and R&D a magnitude of 9% in Chile and 5% in Argentina, which seems to evidence a complementarity relationship between these two policies. Although with different magnitudes, conclusions remain consistent using OLS, treatment-effects and IV. Firms’ heterogeneity is also accounted for, estimating a quantile model.

Date of Award	17 Jun 2013
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Rita Almeida (Supervisor) & Leonor Modesto (Co-Supervisor)