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HUMAN CAPITAL FORMATION AND CONTINUOUS TRAINING: EVIDENCE FOR EU COUNTRIES

Research output: Contribution to journalArticlepeer-review

Original languageEnglish
Pages (from-to)531-549
Number of pages19
JournalREVIEW OF INCOME AND WEALTH
Volume58
Issue number3
DOIs
PublishedSep 2012

King's Authors

Abstract

This paper links data on continuous training from the EU Labour Force Survey (LFS) to information on skill levels and earnings from the EU KLEMS growth and productivity accounts, to examine the relative magnitudes of continuous workforce training versus human capital formation through the general education system in the European Union. The measurement methodology draws from the literature on measuring intangible investments by firms and sources of growth in an accounting framework. The results suggest that in the EU15 group of countries, intangible investments in continuous training represent just under 2 percent of GDP or about 35 percent of expenditure on general education. The share of GDP accounted for by training is less than a third as large in the new member states. A growth accounting method is employed to show that failure to account for continuous training leads to an underestimate of the impact of human capital on output growth in the EU.

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