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Employer-sponsored training in stabilisation and growth policy perspectives

Abstract of Working paper 2003:8

In Europe, accounting standards prevent larger expenditures on employersponsored training from being treated as investments. Using Sweden as example, we discuss two consequences for training.
First, the timing: training will be conducted when income is large enough for training costs to be deducted without loss. This is more often possible during booms than recessions, providing a stabilisation policy dimension to training.
Second, the volume: the training opportunity cost (foregone production) is largest during booms. Hence, training tends to be smaller than if conducted during downturns, possibly limiting growth.
We formulate two proposals that can make training more counter-cyclical
and increase the amount of training.

JEL Codes: D21, E32, H25, M41, M53


Published by:

Ifau

Changed:

9/21/2010