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On-the-job training and rigidity of employment protection in the developing world: Evidence from differential enforcement |
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| Authors: | Rita K Almeida Reyes Aterido |
| Institution: | 1. Universitat Autònoma de Barcelona, Department of Business, Edifici B, Campus UAB, 08913 Bellaterra, Barcelona, Spain;2. Fundación ECSIM, Medellín, Colombia;3. Deusto Business School, University of Deusto, Mundaiz 50, 20012 Donostia-San Sebastian, Spain;4. Universitat Autònoma de Barcelona, Tourism and Hotel Management School, Edifici Blanc, Campus UAB, 08913 Bellaterra, Barcelona, Spain;5. Universitat Oberta de Catalunya, Economics and Business Studies, Internet Interdisciplinary Institute (IN3), MediaTIC Building, Roc Boronat Street, 117, 6th Floor, 08018 Barcelona, Spain |
| Abstract: | This paper analyzes the causal effect between strict employment protection regulations and the firm incentive to invest in job training of their employees. We explore a large firm level data set across several developing countries and assume that the rigidity of labor regulations affects more the investment decision of firms that faces a rigid enforcement of labor regulations. Our findings show that differences across countries in the enforcement of more rigid employment protection regulation are associated with very small differences in the investment in job training across firms. This finding is robust across several specifications and samples. |
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