Apprenticeship training for investment or substitution
Identifieur interne : 001C19 ( Istex/Corpus ); précédent : 001C18; suivant : 001C20Apprenticeship training for investment or substitution
Auteurs : Uschi Backesgellner ; Jens Mohrenweiser ; Uschi BackesgellnerSource :
- International Journal of Manpower [ 0143-7720 ] ; 2010-08-17.
Abstract
Purpose The purpose of this paper is to derive an empirical method to identify different types of training strategies of companies based on publicly available company data. Designmethodologyapproach Using a tenyear panel, the withinfirm retention rate, defined as the average proportion of apprentices staying in a company in relation to all apprenticeship graduates of a company over several years, was analyzed. The withinfirm retention rate is used to identify these companies' training strategies. Findings It was shown that companies' motivation for apprenticeship training in Germany is not homogeneous 19 percent of all companies follow a substitution strategy and 44 percent follow an investment strategy. The determinants of the substitution strategy were estimated and, for example, sizeable differences were found between sectors with different skill requirements and between firms' coverage of industrial relations. Research limitationsimplications The method is well suited to classify substitutionmotivated training firms but it is less precise in identifying the investment motivation. Moreover, very small firms which train only one apprentice need longer panel duration for precise results and therefore the classification results are less precise for very small firms. Practical implications The classification can be used to identify determinants of company participation in apprenticeship training and to predict changes in demand for apprentices. Originalityvalue A simple and innovative method of identifying different types of training motivation with publicly available company data was derived, which has so far been possible only with very detailed companyspecific apprenticeship surveys.
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DOI: 10.1108/01437721011066353
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<record><TEI wicri:istexFullTextTei="biblStruct"><teiHeader><fileDesc><titleStmt><title xml:lang="en">Apprenticeship training for investment or substitution</title><author wicri:is="90%"><name sortKey="Backesgellner, Uschi" sort="Backesgellner, Uschi" uniqKey="Backesgellner U" first="Uschi" last="Backesgellner">Uschi Backesgellner</name></author><author><name sortKey="Mohrenweiser, Jens" sort="Mohrenweiser, Jens" uniqKey="Mohrenweiser J" first="Jens" last="Mohrenweiser">Jens Mohrenweiser</name><affiliation><mods:affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</mods:affiliation></affiliation></author><author><name sortKey="Backesgellner, Uschi" sort="Backesgellner, Uschi" uniqKey="Backesgellner U" first="Uschi" last="Backesgellner">Uschi Backesgellner</name><affiliation><mods:affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</mods:affiliation></affiliation></author></titleStmt><publicationStmt><idno type="wicri:source">ISTEX</idno><idno type="RBID">ISTEX:7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610</idno><date when="2010" year="2010">2010</date><idno type="doi">10.1108/01437721011066353</idno><idno type="url">https://api.istex.fr/document/7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610/fulltext/pdf</idno><idno type="wicri:Area/Istex/Corpus">001C19</idno><idno type="wicri:explorRef" wicri:stream="Istex" wicri:step="Corpus" wicri:corpus="ISTEX">001C19</idno></publicationStmt><sourceDesc><biblStruct><analytic><title level="a" type="main" xml:lang="en">Apprenticeship training for investment or substitution</title><author wicri:is="90%"><name sortKey="Backesgellner, Uschi" sort="Backesgellner, Uschi" uniqKey="Backesgellner U" first="Uschi" last="Backesgellner">Uschi Backesgellner</name></author><author><name sortKey="Mohrenweiser, Jens" sort="Mohrenweiser, Jens" uniqKey="Mohrenweiser J" first="Jens" last="Mohrenweiser">Jens Mohrenweiser</name><affiliation><mods:affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</mods:affiliation></affiliation></author><author><name sortKey="Backesgellner, Uschi" sort="Backesgellner, Uschi" uniqKey="Backesgellner U" first="Uschi" last="Backesgellner">Uschi Backesgellner</name><affiliation><mods:affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</mods:affiliation></affiliation></author></analytic><monogr></monogr><series><title level="j">International Journal of Manpower</title><idno type="ISSN">0143-7720</idno><imprint><publisher>Emerald Group Publishing Limited</publisher><date type="published" when="2010-08-17">2010-08-17</date><biblScope unit="volume">31</biblScope><biblScope unit="issue">5</biblScope><biblScope unit="page" from="545">545</biblScope><biblScope unit="page" to="562">562</biblScope></imprint><idno type="ISSN">0143-7720</idno></series><idno type="istex">7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610</idno><idno type="DOI">10.1108/01437721011066353</idno><idno type="filenameID">0160310503</idno><idno type="original-pdf">0160310503.pdf</idno><idno type="href">01437721011066353.pdf</idno></biblStruct></sourceDesc><seriesStmt><idno type="ISSN">0143-7720</idno></seriesStmt></fileDesc><profileDesc><textClass></textClass><langUsage><language ident="en">en</language></langUsage></profileDesc></teiHeader><front><div type="abstract">Purpose The purpose of this paper is to derive an empirical method to identify different types of training strategies of companies based on publicly available company data. Designmethodologyapproach Using a tenyear panel, the withinfirm retention rate, defined as the average proportion of apprentices staying in a company in relation to all apprenticeship graduates of a company over several years, was analyzed. The withinfirm retention rate is used to identify these companies' training strategies. Findings It was shown that companies' motivation for apprenticeship training in Germany is not homogeneous 19 percent of all companies follow a substitution strategy and 44 percent follow an investment strategy. The determinants of the substitution strategy were estimated and, for example, sizeable differences were found between sectors with different skill requirements and between firms' coverage of industrial relations. Research limitationsimplications The method is well suited to classify substitutionmotivated training firms but it is less precise in identifying the investment motivation. Moreover, very small firms which train only one apprentice need longer panel duration for precise results and therefore the classification results are less precise for very small firms. Practical implications The classification can be used to identify determinants of company participation in apprenticeship training and to predict changes in demand for apprentices. Originalityvalue A simple and innovative method of identifying different types of training motivation with publicly available company data was derived, which has so far been possible only with very detailed companyspecific apprenticeship surveys.</div></front></TEI><istex><corpusName>emerald</corpusName><editor><json:item><name>Uschi BackesGellner</name></json:item></editor><author><json:item><name>Uschi BackesGellner</name></json:item><json:item><name>Jens Mohrenweiser</name><affiliations><json:string>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</json:string></affiliations></json:item><json:item><name>Uschi BackesGellner</name><affiliations><json:string>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</json:string></affiliations></json:item></author><subject><json:item><lang><json:string>eng</json:string></lang><value>Apprenticeships</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>Training</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>Human capital</value></json:item></subject><language><json:string>eng</json:string></language><originalGenre><json:string>research-article</json:string></originalGenre><abstract>Purpose The purpose of this paper is to derive an empirical method to identify different types of training strategies of companies based on publicly available company data. Designmethodologyapproach Using a tenyear panel, the withinfirm retention rate, defined as the average proportion of apprentices staying in a company in relation to all apprenticeship graduates of a company over several years, was analyzed. The withinfirm retention rate is used to identify these companies' training strategies. Findings It was shown that companies' motivation for apprenticeship training in Germany is not homogeneous 19 percent of all companies follow a substitution strategy and 44 percent follow an investment strategy. The determinants of the substitution strategy were estimated and, for example, sizeable differences were found between sectors with different skill requirements and between firms' coverage of industrial relations. Research limitationsimplications The method is well suited to classify substitutionmotivated training firms but it is less precise in identifying the investment motivation. Moreover, very small firms which train only one apprentice need longer panel duration for precise results and therefore the classification results are less precise for very small firms. Practical implications The classification can be used to identify determinants of company participation in apprenticeship training and to predict changes in demand for apprentices. Originalityvalue A simple and innovative method of identifying different types of training motivation with publicly available company data was derived, which has so far been possible only with very detailed companyspecific apprenticeship surveys.</abstract><qualityIndicators><score>9.868</score><pdfVersion>1.3</pdfVersion><pdfPageSize>519 x 680 pts</pdfPageSize><refBibsNative>true</refBibsNative><keywordCount>3</keywordCount><abstractCharCount>1714</abstractCharCount><pdfWordCount>6484</pdfWordCount><pdfCharCount>43684</pdfCharCount><pdfPageCount>18</pdfPageCount><abstractWordCount>239</abstractWordCount></qualityIndicators><title>Apprenticeship training for investment or substitution</title><refBibs><json:item><author><json:item><name>D. Acemoglu</name></json:item><json:item><name>J.S. 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Wolter</name></json:item><json:item><name>S. Mhlemann</name></json:item><json:item><name>J. Schweri</name></json:item></author><host><volume>7</volume><issue>3</issue><author></author><title>German Economic Review</title></host><title>Why some firms train apprentices and many others do not</title></json:item><json:item><author><json:item><name>T. Zwick</name></json:item></author><host><volume>40</volume><pages><last>204</last><first>193</first></pages><issue>23</issue><author></author><title>Zeitschrift fr Arbeitsmarktforschung</title></host><title>Apprenticeship training in Germany investment or productivitydriven</title></json:item></refBibs><genre><json:string>research-article</json:string></genre><host><volume>31</volume><publisherId><json:string>ijm</json:string></publisherId><pages><last>562</last><first>545</first></pages><issn><json:string>0143-7720</json:string></issn><issue>5</issue><subject><json:item><value>Economics</value></json:item></subject><genre><json:string>journal</json:string></genre><language><json:string>unknown</json:string></language><title>International Journal of Manpower</title><doi><json:string>10.1108/ijm</json:string></doi></host><categories><wos><json:string>social science</json:string><json:string>management</json:string><json:string>industrial relations & labor</json:string></wos><scienceMetrix><json:string>economic & social sciences</json:string><json:string>economics & business </json:string><json:string>industrial relations</json:string></scienceMetrix></categories><publicationDate>2010</publicationDate><copyrightDate>2010</copyrightDate><doi><json:string>10.1108/01437721011066353</json:string></doi><id>7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610</id><score>0.021159194</score><fulltext><json:item><extension>pdf</extension><original>true</original><mimetype>application/pdf</mimetype><uri>https://api.istex.fr/document/7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610/fulltext/pdf</uri></json:item><json:item><extension>zip</extension><original>false</original><mimetype>application/zip</mimetype><uri>https://api.istex.fr/document/7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610/fulltext/zip</uri></json:item><istex:fulltextTEI uri="https://api.istex.fr/document/7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610/fulltext/tei"><teiHeader><fileDesc><titleStmt><title level="a" type="main" xml:lang="en">Apprenticeship training for investment or substitution</title></titleStmt><publicationStmt><authority>ISTEX</authority><publisher>Emerald Group Publishing Limited</publisher><availability><p>© Emerald Group Publishing Limited</p></availability><date>2010</date></publicationStmt><sourceDesc><biblStruct type="inbook"><analytic><title level="a" type="main" xml:lang="en">Apprenticeship training for investment or substitution</title><author xml:id="author-1"><persName><forename type="first">Uschi</forename><surname>BackesGellner</surname></persName></author><editor><persName><forename type="first">Uschi</forename><surname>BackesGellner</surname></persName></editor><author xml:id="author-3"><persName><forename type="first">Jens</forename><surname>Mohrenweiser</surname></persName><affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</affiliation></author><author xml:id="author-4"><persName><forename type="first">Uschi</forename><surname>BackesGellner</surname></persName><affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</affiliation></author></analytic><monogr><title level="j">International Journal of Manpower</title><idno type="pISSN">0143-7720</idno><idno type="DOI">10.1108/ijm</idno><imprint><publisher>Emerald Group Publishing Limited</publisher><date type="published" when="2010-08-17"></date><biblScope unit="volume">31</biblScope><biblScope unit="issue">5</biblScope><biblScope unit="page" from="545">545</biblScope><biblScope unit="page" to="562">562</biblScope></imprint></monogr><idno type="istex">7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610</idno><idno type="DOI">10.1108/01437721011066353</idno><idno type="filenameID">0160310503</idno><idno type="original-pdf">0160310503.pdf</idno><idno type="href">01437721011066353.pdf</idno></biblStruct></sourceDesc></fileDesc><profileDesc><creation><date>2010</date></creation><langUsage><language ident="en">en</language></langUsage><abstract><p>Purpose The purpose of this paper is to derive an empirical method to identify different types of training strategies of companies based on publicly available company data. Designmethodologyapproach Using a tenyear panel, the withinfirm retention rate, defined as the average proportion of apprentices staying in a company in relation to all apprenticeship graduates of a company over several years, was analyzed. The withinfirm retention rate is used to identify these companies' training strategies. Findings It was shown that companies' motivation for apprenticeship training in Germany is not homogeneous 19 percent of all companies follow a substitution strategy and 44 percent follow an investment strategy. The determinants of the substitution strategy were estimated and, for example, sizeable differences were found between sectors with different skill requirements and between firms' coverage of industrial relations. Research limitationsimplications The method is well suited to classify substitutionmotivated training firms but it is less precise in identifying the investment motivation. Moreover, very small firms which train only one apprentice need longer panel duration for precise results and therefore the classification results are less precise for very small firms. Practical implications The classification can be used to identify determinants of company participation in apprenticeship training and to predict changes in demand for apprentices. Originalityvalue A simple and innovative method of identifying different types of training motivation with publicly available company data was derived, which has so far been possible only with very detailed companyspecific apprenticeship surveys.</p></abstract><textClass><keywords scheme="keyword"><list><head>keywords</head><item><term>Apprenticeships</term></item><item><term>Training</term></item><item><term>Human capital</term></item></list></keywords></textClass><textClass><keywords scheme="Emerald Subject Group"><list><label>cat-ECO</label><item><term>Economics</term></item></list></keywords></textClass></profileDesc><revisionDesc><change when="2010-08-17">Published</change></revisionDesc></teiHeader></istex:fulltextTEI><json:item><extension>txt</extension><original>false</original><mimetype>text/plain</mimetype><uri>https://api.istex.fr/document/7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610/fulltext/txt</uri></json:item></fulltext><metadata><istex:metadataXml wicri:clean="corpus emerald not found" wicri:toSee="no header"><istex:xmlDeclaration>version="1.0" encoding="UTF-8"</istex:xmlDeclaration><istex:document><!-- Auto generated NISO JATS XML created by Atypon out of MCB DTD source files. Do Not Edit! --><article dtd-version="1.0" xml:lang="en" article-type="research-article"><front><journal-meta><journal-id journal-id-type="publisher-id">ijm</journal-id><journal-id journal-id-type="doi">10.1108/ijm</journal-id><journal-title-group><journal-title>International Journal of Manpower</journal-title></journal-title-group><issn pub-type="ppub">0143-7720</issn><publisher><publisher-name>Emerald Group Publishing Limited</publisher-name></publisher></journal-meta><article-meta><article-id pub-id-type="doi">10.1108/01437721011066353</article-id><article-id pub-id-type="original-pdf">0160310503.pdf</article-id><article-id pub-id-type="filename">0160310503</article-id><article-categories><subj-group subj-group-type="type-of-publication"><compound-subject><compound-subject-part content-type="code">research-article</compound-subject-part><compound-subject-part content-type="label">Research paper</compound-subject-part></compound-subject></subj-group><subj-group subj-group-type="subject"><compound-subject><compound-subject-part content-type="code">cat-ECO</compound-subject-part><compound-subject-part content-type="label">Economics</compound-subject-part></compound-subject></subj-group></article-categories><title-group><article-title>Apprenticeship training: for investment or substitution?</article-title></title-group><contrib-group><contrib contrib-type="editor"><string-name><given-names>Uschi</given-names> <surname>Backes‐Gellner</surname></string-name><x> and </x><string-name><given-names>Stefan C.</given-names> <surname>Wolter</surname></string-name></contrib></contrib-group><contrib-group><contrib contrib-type="author"><string-name><given-names>Jens</given-names> <surname>Mohrenweiser</surname></string-name><aff>University of Zurich and Swiss Leading House on Economics of Education: Firm Behavior and Training Policies, Zurich, Switzerland</aff></contrib><x></x><contrib contrib-type="author"><string-name><given-names>Uschi</given-names> <surname>Backes‐Gellner</surname></string-name><aff>University of Zurich and Swiss Leading House on Economics of Education: Firm Behavior and Training Policies, Zurich, Switzerland</aff></contrib></contrib-group><pub-date pub-type="ppub"><day>17</day><month>08</month><year>2010</year></pub-date><volume>31</volume><issue>5</issue><issue-title>Economics of vocational education and training policies</issue-title><issue-title content-type="short">Economics vocational education training</issue-title><fpage>545</fpage><lpage>562</lpage><permissions><copyright-statement>© Emerald Group Publishing Limited</copyright-statement><copyright-year>2010</copyright-year><license license-type="publisher"><license-p></license-p></license></permissions><self-uri content-type="pdf" xlink:href="01437721011066353.pdf"></self-uri><abstract><sec><title content-type="abstract-heading">Purpose</title><x> – </x><p>The purpose of this paper is to derive an empirical method to identify different types of training strategies of companies based on publicly available company data.</p></sec><sec><title content-type="abstract-heading">Design/methodology/approach</title><x> – </x><p>Using a ten‐year panel, the within‐firm retention rate, defined as the average proportion of apprentices staying in a company in relation to all apprenticeship graduates of a company over several years, was analyzed. The within‐firm retention rate is used to identify these companies' training strategies.</p></sec><sec><title content-type="abstract-heading">Findings</title><x> – </x><p>It was shown that companies' motivation for apprenticeship training in Germany is not homogeneous: 19 percent of all companies follow a substitution strategy and 44 percent follow an investment strategy. The determinants of the substitution strategy were estimated and, for example, sizeable differences were found between sectors with different skill requirements and between firms' coverage of industrial relations.</p></sec><sec><title content-type="abstract-heading">Research limitations/implications</title><x> – </x><p>The method is well suited to classify substitution‐motivated training firms but it is less precise in identifying the investment motivation. Moreover, very small firms which train only one apprentice need longer panel duration for precise results and therefore the classification results are less precise for very small firms.</p></sec><sec><title content-type="abstract-heading">Practical implications</title><x> – </x><p>The classification can be used to identify determinants of company participation in apprenticeship training and to predict changes in demand for apprentices.</p></sec><sec><title content-type="abstract-heading">Originality/value</title><x> – </x><p>A simple and innovative method of identifying different types of training motivation with publicly available company data was derived, which has so far been possible only with very detailed company‐specific apprenticeship surveys.</p></sec></abstract><kwd-group><kwd>Apprenticeships</kwd><x>, </x><kwd>Training</kwd><x>, </x><kwd>Human capital</kwd></kwd-group><custom-meta-group><custom-meta><meta-name>peer-reviewed</meta-name><meta-value>yes</meta-value></custom-meta><custom-meta><meta-name>academic-content</meta-name><meta-value>yes</meta-value></custom-meta><custom-meta><meta-name>rightslink</meta-name><meta-value>included</meta-value></custom-meta></custom-meta-group></article-meta><ack><p>This research is funded by the Swiss Federal Office for Professional Education and Technology through its Leading House on Economics of Education: Firm Behaviour and Training Policies. The authors thank Bernd Frick, Matthias Kräkel, Paul Marginson, Kerstin Pull, the referees and especially Thomas Zwick and the participants of the Economics of Education seminar at the University of Zürich, Fall term 2007, and the Personalökonomisches Kolloquium at Bonn, March 2008, for important comments. They are also grateful to Yvonne Herzog for research assistance and to the Forschungsdatenzentrum of the Bundesagentur für Arbeit – and especially Dana Müller – for being helpful with the data and Günter Walden for providing data for the cost benefit study.</p></ack></front><body><sec><title>1. Introduction</title><p>The apprenticeship system in Germany is generally considered to be a company investment in human capital. This common belief is mainly based on the results of the German cost‐benefit studies of the BIBB (for latest results see <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> 2004</xref>), which estimated that almost all companies have sizeable net costs of apprenticeship training<xref ref-type="fn" rid="fn1">[1]</xref>. Since apprenticeships are unanimously considered to offer general skills these findings have motivated many researchers to study the role of market imperfections as an incentive for the training decision of companies (<xref ref-type="bibr" rid="b8">Franz and Soskice, 1995</xref>; <xref ref-type="bibr" rid="b1">Acemoglu and Pischke, 1998</xref>, <xref ref-type="bibr" rid="b2">1999</xref>; <xref ref-type="bibr" rid="b6">Dustmann and Schönberg, 2009</xref>; <xref ref-type="bibr" rid="b15">Kessler and Lülfesmann, 2006</xref>). Based on these theoretical discussions, the German apprenticeship system is often used as the institutional setting for empirical investigations of company sponsored general training (<xref ref-type="bibr" rid="b11">Harhoff and Kane, 1997</xref>; <xref ref-type="bibr" rid="b1">Acemoglu and Pischke, 1998</xref>; <xref ref-type="bibr" rid="b6">Dustmann and Schönberg, 2009</xref>). These empirical studies implicitly assume that all German firms which train apprentices invest in human capital but none of these studies actually checks this fact. However, in addition to an investment view, <xref ref-type="bibr" rid="b18">Lindley (1975)</xref> already argues that there may be a second motivation for apprenticeship training, namely a production or substitution strategy. He describes apprentices as productive workers who are used as cheap substitutes for unskilled or semiskilled workers. The substitution motivation states that the productivity of apprentices (who are used as regular production workers) is higher than their training costs and that the unit labour costs of apprentices are lower than the unit labour costs of other (unskilled) employees whom they substitute.</p><p>So the first aim of our paper is to study whether the German apprenticeship system is indeed homogeneously a human capital investment of the companies. We develop an alternative method which can be used with publicly available company data to identify the two training strategies of firms. We argue that a sufficient condition to distinguish between the two training strategies is the within firm retention rate over several years, defined as the average proportion of apprentices staying in the company in relation to all apprenticeship graduates of a company over several years. If an engagement in apprenticeship training is supposed to be an investment in human capital that earns long term returns for the company, such earnings are clearly only possible if a sufficient number of apprentices stays in the company after they have finished their apprenticeship (see the integrated model of <xref ref-type="bibr" rid="b2">Acemoglu and Pischke, 1999</xref>). In contrast, a substitution strategy does not require that apprenticeship graduates stay within the training company because offering apprenticeships is driven by the unit labour costs of apprentices in comparison to suitable substitutes. If apprentices are indeed used as cheap workers during the apprenticeship it can to the contrary be expected that they are too expensive after their apprenticeship, meaning that retaining apprentices is rather the exception than the rule. If we look at the long‐term within‐firm retention rate we find a strong clustering on both extremes of the distribution. Overall, 18.5 percent of the companies nearly never hire their own apprenticeship graduates, while 43.75 percent of the companies hire almost all of their own apprenticeship graduates. We argue that companies which never hire their apprenticeship graduates can be clearly assigned to the substitution strategy and that companies which hire almost all of their graduates can clearly be assigned to the investment strategy. Based on this classification method we find evidence for a non negligible share of companies with a substitution strategy (around 18.5 percent of all training companies). This result is in contrast to the widely accepted stylized fact of a pure investment strategy of German firms.</p><p>In a second step, we show the reliability of our classification method by comparing it with descriptive results of the most recent German cost benefit study. In a third step, we study the determinants of companies using a substitution strategy. We first find that the probability of the substitution strategy increases with lower capital equipment, with the absence of works councils and with a higher share of white collar workers as well as in smaller firms. We further find that service sector firms have a significantly higher probability to follow a substitution strategy than manufacturing firms. Finally, we found complementarities between firms' investments in apprenticeship training and firm sponsored continuing training.</p><p>The paper is structured as follows. After a short literature review (section 2), important institutional settings are introduced and the within firm retention rate is defined. Then, the company training strategies are verified by a comparison with the cost‐benefit studies (section 3). Afterwards, we estimate determinants of a substitution training strategy (section 4) and conclude with theoretical and policy implications (section 5).</p></sec><sec><title>2. Literature review</title><p>According to <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref> 96 percent of the training companies incur on average net costs during the apprenticeships<xref ref-type="fn" rid="fn2">[2]</xref>. They conclude that the investment strategy clearly dominates while the substitution strategy can only be found on the fringes. This stylised fact has motivated many researchers to study the role of market imperfections as a source of the investment of German companies in apprenticeships that provide general skills (<xref ref-type="bibr" rid="b8">Franz and Soskice, 1995</xref>; <xref ref-type="bibr" rid="b1">Acemoglu and Pischke, 1998</xref>, <xref ref-type="bibr" rid="b2">1999</xref>; <xref ref-type="bibr" rid="b6">Dustmann and Schönberg, 2009</xref>; <xref ref-type="bibr" rid="b15">Kessler and Lülfesmann, 2006</xref>). The theoretical models explain the incentive of companies to invest in apprenticeships through asymmetric information (<xref ref-type="bibr" rid="b14">Katz and Ziderman, 1990</xref>; <xref ref-type="bibr" rid="b1">Acemoglu and Pischke, 1998</xref>), complementarities between general and specific human capital (<xref ref-type="bibr" rid="b8">Franz and Soskice, 1995</xref>; <xref ref-type="bibr" rid="b15">Kessler and Lülfesmann, 2006</xref>) or labour market institutions such as unions (<xref ref-type="bibr" rid="b6">Dustmann and Schönberg, 2009</xref>). <xref ref-type="bibr" rid="b2">Acemoglu and Pischke (1999)</xref> integrate different theoretical models in one general framework. In contrast to the frequently modelled investment strategy, the substitution strategy is mostly intuitively introduced. The substitution strategy can be analyzed by a simple microeconomic production model with two substitutable input factors (e.g. apprentices and unskilled workers) in which employment is only dependent on the relative unit labour costs (substitution of two input factors). However, <xref ref-type="bibr" rid="b18">Lindley (1975)</xref> studied this strategy in a more complex and formal analytical framework.</p><p>According to the theoretical discussions the German apprenticeship system is used as the institutional setting for empirical investigations of company sponsored general training (<xref ref-type="bibr" rid="b11">Harhoff and Kane, 1997</xref>; <xref ref-type="bibr" rid="b1">Acemoglu and Pischke;, 1998</xref>, <xref ref-type="bibr" rid="b6">Dustmann and Schönberg, 2009</xref>), but the assumption of positive net costs are not been tested. Some of these empirical studies however stress that apprenticeship training strategies are not unique across sectors and firm sizes (<xref ref-type="bibr" rid="b24">Soskice, 1994</xref>; <xref ref-type="bibr" rid="b8">Franz and Soskice;, 1995</xref>; <xref ref-type="bibr" rid="b21">Neubäumer and Bellmann, 1999</xref>). For example, an increasing training incidence by firm size is explained by the presence of internal labour markets in larger firms. A first doubt on the overwhelming dominance of net cost argument in Germany occurs by the Swiss cost benefit study of <xref ref-type="bibr" rid="b26">Wolter <italic>et al.</italic>(2006)</xref>. They find that only one half of the larger firms and one third of the smaller firms incur net costs during the apprenticeship. The huge differences are somewhat surprising because of the similarity of both training systems. However, <xref ref-type="bibr" rid="b5">Dionisius <italic>et al.</italic> (2009)</xref> show that a part of the difference can be explained by a higher share of productive tasks allocated to apprentices in Switzerland and the differences in comparatively lower apprentice to skilled worker wages. Finally, <xref ref-type="bibr" rid="b27">Zwick (2007)</xref> estimates the contribution of changes in the proportion of apprentices on changes in firm performance in Germany. He found an insignificant and not a negative effect of the share of apprentices on productivity which would be expected in a pure investment strategy. He concludes that the investment and the substitution strategy may outweigh each other on average and that the cost benefit study of <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref> might underestimate the substitution strategy.</p><p>However, most of the cited theoretical and empirical studies fail to discuss explicitly the retention rate of apprenticeship graduates as a necessary precondition for a return on investment. One exception is the theoretical model of <xref ref-type="bibr" rid="b2">Acemoglu and Pischke (1999)</xref> in which the retention rate is seen as an important training incentive. Empirical studies on the retention rates in Germany focus only on the individual rather than on the company. These studies estimate the effect of mobility of apprenticeship graduates on wages or duration of the first job after apprenticeship (see <xref ref-type="bibr" rid="b7">Euwals and Winkelmann, 2004</xref> for a discussion). There are also a few studies investigating different sectoral retention rates, e.g. by <xref ref-type="bibr" rid="b22">Schwerdt and Bender (2003)</xref> who estimate the probability of an employer changing of apprenticeship graduates and <xref ref-type="bibr" rid="b4">Büchel and Neubäumer (2001)</xref> who estimate the determinants of an employment in the training occupation for apprenticeship graduates. For Switzerland, <xref ref-type="bibr" rid="b25">Wolter and Schweri (2002)</xref> analyze the retention rate more in depth and show that the strategy of retaining apprenticeship graduates immediately after training depends substantially on the benefits derived after the apprenticeship but less on firms' net costs during the training period. Furthermore, they find that firms which employ their apprenticeship graduates three years after graduation have heavily invested during the apprenticeship. However, to the best of our knowledge there is so far no empirical analysis based on German company data and studying the relation of retention rates and apprenticeship training on company level<xref ref-type="fn" rid="fn3">[3]</xref>.</p></sec><sec><title>3. Within firm retention rate as an indicator for firms' training strategies</title><p>We argue that a sufficient condition to distinguish between the two training strategies, investment or substitution motive, is the within firm retention rate which is defined as the proportion of apprentices staying in the company in relation to all apprenticeship graduates of a company. If a firm's engagement in apprenticeship training is supposed to be an investment in human capital, such earnings are clearly only possible if a sufficient number of apprentices stays in the company after they have finished their apprenticeship (see the integrated model of <xref ref-type="bibr" rid="b2">Acemoglu and Pischke, 1999</xref>)<xref ref-type="fn" rid="fn4">[4]</xref>. Consequently, if companies were to follow an investment strategy a minimum number of retained apprentices would be a necessary precondition because without any apprentice staying at the company positive returns on investment are not possible. In contrast, a substitution strategy does not require that apprenticeship graduates stay within the company to make it economically successful because under a substitution strategy offering apprenticeships is driven by the cheap labour costs of apprentices in comparison to their productivity during the training period. If apprentices are indeed used as cheap labour it can be expected – contrary to what was expected above – that after the apprenticeship is finished the same person is too expensive in comparison to its productivity, meaning that retaining apprentices is rather the exception than the rule. So if the retention rate is always zero this can be assumed to be a reliable indicator for a substitution strategy.</p><p>However, in order to reliably discriminate between companies following an investment or a substitution strategy, one additional condition has to be met. Since apprentices are always employed under fixed‐term contracts (which are terminated at the end of the apprenticeship programme), apprentices themselves may decide not to stay in the company, meaning that not all apprentices are necessarily staying in the company even if a company with an investment motive would want them to stay. Instead, some of the apprentices may as well decide to leave the training firm after their apprenticeship. To account for this problem we look at the retention rate over several years to get a more reliable identification strategy for a company's training motive. We argue that if a company which invests in apprenticeship training over several years cannot attract a substantial share of their apprenticeship graduates to stay in the firm, it is requested to withdraw from apprenticeship training because otherwise it keeps having negative instead of positive returns to their investment. So even if we are not able to discriminate between contract terminations induced by the firm or by the apprentice, it still helps to single out firms following a substitution motive because a positive within firm retention rate over several years is a precondition for positive returns to the investment. Thus the within firm retention rate helps us to empirically distinguish between the two training strategies.</p><p>In order to do so we calculate the average yearly retention rate of apprenticeship graduates based on the waves 1996‐2005 of the IAB Establishment Panel. This representative survey collects yearly information about the number of apprentices, graduates and stayers and a large number of general firm characteristics (see <xref ref-type="bibr" rid="b16">Kölling, 2000</xref>). The retention rates immediately after completion of the apprenticeship is relatively stable and vary between 60 and 67 percent, corresponding to <xref ref-type="bibr" rid="b7">Euwals and Winkelmann (2004)</xref> or <xref ref-type="bibr" rid="b9">Franz and Zimmermann (2002)</xref><xref ref-type="fn" rid="fn5">[5]</xref>. So in the short run only about one third of apprenticeship graduates leave the training firm.</p><p>However, the yearly mean of the retention rate is a result of a strong clustering on both extremes of the retention rate distribution (see <xref ref-type="fig" rid="F_0160310503001">Figure 1</xref>, panel A) which shows that on the left end of the distribution nearly 21 percent of all companies do not hire their own apprentices and on the right end of the distribution almost 45 percent of the companies hire all of their apprenticeship graduates. The strong clustering of the retention rate distribution is similar in every year. However, to identify the training motive of one particular company we need the retention rate of a particular firm over a minimum number of years and we name this the within firm retention rate and study it over several years (for all training firms for whom we observe graduates in at least three years; see <xref ref-type="fig" rid="F_0160310503001">Figure 1</xref> panel B for the 2003 distribution)<xref ref-type="fn" rid="fn6">[6]</xref>. The distribution of the within firm retention rate over all firms shows a similarly strong clustering on both extremes of the distribution. Companies on the left end of the distribution in panel B of <xref ref-type="fig" rid="F_0160310503001">Figure 1</xref> never hire their own graduates over several years. At minimum, these 14 percent of all training companies can definitely not follow an investment strategy because they have no possibility of gaining returns after the investment period, i.e. after the apprenticeship termination. Thus the benefits have to be extracted during the apprenticeship period. In contrast, the companies on the right end of the distribution (25 percent) retain all their apprentices, clearly indicating that it pays to keep apprentices as skilled workers after they finish their apprenticeship.</p><p>For a structural comparison of our results with results from earlier studies, namely <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref>, we use the following definition for a substitution or an investment strategy based on the distribution of within firm retentions: We define a firm to follow a substitution strategy, if the within firm retention rate is lower than 20 percent (these are firms on the far left end of the distribution in <xref ref-type="fig" rid="F_0160310503001">Figure 1</xref> panel B). We define a firm to follow an investment training strategy if the within firm retention rate is higher than 80 percent over three years (these are the firms on the far right end in <xref ref-type="fig" rid="F_0160310503001">Figure 1</xref> panel B). These somewhat broader definition criteria have as another advantage that they also include companies which diverge slightly from their general retention policy due to an unexpected mismatch between the apprentices and the firm. According to this classification 18.5 percent of the companies' follow a substitution strategy and 43.75 percent follow an investment strategy<xref ref-type="fn" rid="fn7">[7]</xref>.</p><p>Although the low data requirements make this classification very attractive, we have to keep in mind the underlying assumptions when interpreting the results. First, firms with a clear strategy may have to change their ex‐ante strategy for example due to a deteriorated economic situation which accordingly to our classification strategy would result in a classification into the undetermined category. This bias can occur in both training strategies; therefore both numbers have to be considered as a lower bound<xref ref-type="fn" rid="fn8">[8]</xref>. A second limitation arises because training companies with only one apprentice require a longer observation period to be classified adequately. For example, a small company with only one apprentice can only be classified, if we observe at least three graduations during a ten year period, for example in 1998, 2001 and 2004. This may lead to a lower share of small firms in the classification sample than in the whole population. Thus, training strategies are less precisely identified for small companies, i.e. the margin of error is larger. Third, firms with an investment strategy may also be misclassified if the firm purposefully decides to train more apprentices than required because they use the apprenticeship as a screening period as well. This would underestimate the investment strategy.</p><p>A comparison of our classification of the training motivation is very similar with what has been found in the cost benefit study of <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref>. They study distinguishes between the “full cost account”, which is supposed to provide a lower bound, and the “variable cost account” which is supposed to provide an upper bound of the substitution strategy (see <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref> for a discussion). <xref ref-type="fig" rid="F_0160310503002">Figure 2</xref> shows that the substitution strategy decreases by firm size according to the variable cost approach (dark bars) as well as according to our within‐firm retention rate classification (striped bars). In contrast, the full cost approach does not show a decreasing substitution strategy by firm size (light bars). We also find that our approach always lies between the calculated lower and upper bound of the cost benefit study, which indicates that our results provide an adequate classification despite its simple method and comparatively low data requirements. The strong firm‐size related decrease in the proportion of firms with a substitution strategy can be assumed to reflect the importance of internal labour markets in larger firms (<xref ref-type="bibr" rid="b24">Soskice, 1994</xref>; <xref ref-type="bibr" rid="b21">Neubäumer and Bellmann, 1999</xref>), differences in the training occupations or differences in collective agreements containing an obligation to hire firm internal apprenticeship graduates.</p></sec><sec><title>4. Determinants of a substitution training strategy</title><p>In the following paragraph we use our classification to study what determines whether a firm follows a substitution or an investment strategy with its apprenticeship training. We estimate the determinants of the substitution strategy in the year 2003 for which we have most observations (results however remain stable if we use other years or vary the cut off points in the classification step; detailed results for alternative estimations are given in the Appendix.</p><p>The results of the 2003 regression analysis based on the above mentioned cut‐off definition first show an increasing probability of a substitution strategy with a larger proportion of white‐collar workers in comparison to the reference group of unskilled blue‐collar workers<xref ref-type="fn" rid="fn9">[9]</xref>. This can be interpreted as a consequence of typical internal labour market characteristics. Internal labour market studies show that for blue‐collar workers internal labour markets are much stronger, leading to a longer tenure and a higher probability of company sponsored general training, whereas for white collar workers internal labour markets are less strong and therefore firm sponsored general training should be lower (<xref ref-type="bibr" rid="b13">Janssen and Pfeiffer, 2009</xref>). Internal labour markets also explain why larger firms are less likely to train with a substitution strategy: with increasing firm size the probability of internal labour markets rises and, therefore, the apprenticeships as an important port of entry into the internal labour market are more likely<xref ref-type="fn" rid="fn10">[10]</xref>. This is in line with the argument of <xref ref-type="bibr" rid="b24">Soskice (1994)</xref> who describes the role of internal labour markets as central for the apprenticeship system, because it helps large and medium‐sized companies to retain their apprentices and it provides young people with a strong incentive to strive for an apprenticeship in those companies. Larger firms can therefore attract more able adolescents, as theoretically shown by <xref ref-type="bibr" rid="b8">Franz and Soskice (1995)</xref>. The higher immediate retention rate allows larger firms to invest in more expansive training (see <xref ref-type="fig" rid="F_0160310503004">Table I</xref>).</p><p>Third, we find that service sector firms are significantly more likely to follow a substitution strategy than manufacturing firms meaning they retain on average significantly fewer apprentices over several years. This corresponds with a lower importance of internal labour markets in service sector firms (<xref ref-type="bibr" rid="b13">Janssen und Pfeiffer, 2009</xref>) and that these firms require more general skills (<xref ref-type="bibr" rid="b23">Smits and Zwick, 2004</xref>). This can theoretically be explained by the skill weights approach of <xref ref-type="bibr" rid="b17">Lazear (2009)</xref> who shows that more general bundles of skills lead to a higher probability of an external job offer (see also <xref ref-type="bibr" rid="b10">Geel <italic>et al.</italic> 2010</xref>). This causes a higher mobility of apprenticeship graduates in the service sector as a result of their more general combination of skills<xref ref-type="fn" rid="fn11">[11]</xref>. Basing on the skill weights approach, <xref ref-type="bibr" rid="b10">Geel <italic>et al.</italic> (2010)</xref> show that a higher mobility of apprenticeship graduates correspond with a more general combination of skills. Therefore, service sector firms are more likely requested to ensure cost neutral apprenticeship training and their apprentices have to be more productive during the apprenticeship than apprentices in other sectors where the combination of acquired skills is more specific. Evidence for a higher productivity of service sector apprentices is provided by <xref ref-type="bibr" rid="b19">Mohrenweiser and Zwick (2009)</xref> based on six years social security panel data study. They find a higher productivity of apprentices in commercial and trade occupations in comparison to manufacturing apprentices. Thus, if the service sector becomes more important in the future, this could result in an increasing importance of the substitution strategy if nothing else changes.</p><p>Fourth, we find that a firm's coverage by a collective bargaining agreement results in a higher (but insignificant) probability of a substitution strategy whilst a firm with a works council have a significant lower probability of a substitution strategy. This is in line with the argument that works councils raises company sponsored training expenditures using their co‐determination rights on personnel matters especially the skill development (<xref ref-type="bibr" rid="b20">Müller‐Jentsch, 1995</xref>). These co‐determination rights may be used to negotiate with the business management about an obligatory employment contract of apprenticeship graduates leading to a higher retention rate and this result in to a declining probability of the substitution strategy. This describes theoretically the voice function of employee representation which is widely associated with works councils operating on the company level whereas collective bargaining takes place mostly on the industry level and it is carried out by trade unions. Indeed, the interaction between works councils and collective bargaining is pronounced as the important link to understand the German system of industrial relation because works councils are more beneficial if the company is covered by a collective bargaining contract meaning that the distributional conflicts are delegated to the industry level (<xref ref-type="bibr" rid="b12">Hübler and Jirjahn, 2003</xref>). Interestingly, an interaction term (works council and collective bargaining) enforces the pure collective bargaining effect which results now in a significant higher probability of the substitution strategy. This can be interpreted that if a company faces a collective bargaining contract which can be associated with a binding minimum wage (here especial for unskilled workers) but not a works council it uses apprentices as substitutes for unskilled workers, i.e. they do not retain their apprenticeship graduates. Otherwise, the works council itself has no effect on the training strategy as long as the company is not covered by a collective bargaining agreement which means that the distributional conflicts are not delegated to the industry level. Indeed, the coverage of a works council and a collective bargaining contract decrease the probability of a substitution strategy (interaction effect). Here, the distributional conflicts are negotiated on the industry level and the works council may now use the co‐determination rights to negotiate a job offer for apprenticeship graduates and this changes the role of apprentices within a company fundamentally. These findings support the argument of <xref ref-type="bibr" rid="b12">Hübler and Jirjahn (2003)</xref>, who state that the interaction between works councils and collective bargaining is as fundamental as the firm size in explaining the German system of industrial relations.</p><p>Moreover, a higher capital equipment per employee leads to a lower probability of a substitution strategy indicating complementarities between physical and human capital (<xref ref-type="bibr" rid="b8">Franz and Soskice, 1995</xref>; <xref ref-type="bibr" rid="b2">Acemoglu and Pischke, 1999</xref>). Another interesting result is that a higher export share which is a common measure for a firms' competitiveness does not lead to a lower probability of a substitution strategy. This indicates that a stronger competitive environment is obviously not an obstacle for training investments. Interestingly, foreign owned firms are also not more likely to follow a substitution strategy. Although, foreign owned firms have a lower probability to train apprentices, those firms obviously do not train to substitute unskilled workers with low wage apprentices. Finally, the negative relation between investment in further training and a substitution training strategy indicates complementarities between initial and further training expenditures. Additionally, we have controlled for changes in labour demand by taking into account the workforce development in the last year and the regional unemployment rate. The first makes sure that hiring of a company's own apprenticeship graduates is not a pure question of a rising labour demand. The latter controls for regional labour market differences.</p></sec><sec><title>5. Conclusion</title><p>Apprenticeship training in Germany is typically seen as an investment of companies into the human capital of their apprentices in many theoretical and empirical studies over the last decades. This view is based on the German cost benefit studies which provide evidence for substantial net costs for firms training apprentices. However, this assumption has not been reconfirmed by other types of data or methods so far. We show that apprenticeship training firms does not follow one homogeneous strategy. Rather, some firms follow an investment strategy and others follow a substitution strategy. We suggest an empirical method based on a detailed analysis of retention rates to distinguish between both strategies. According to our classification, we find 18.5 percent of all companies to follow a substitution strategy and 43.75 percent to follow an investment strategy; the rest is mixed or undetermined. We can further show that our classification method is in line with structural features of the available cost benefit studies; the within firm retention rate distribution is located between the full and the variable cost account estimates of <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref>. The classification based on within‐firm retention rates is attractive because it is applicable in public available databases. It is well suited to classify substitution motivated training firms but it is less precise in identifying the investment motivation. Moreover, very small firms which train only one apprentice need longer panel duration and therefore classification results are less precise for very small firms.</p><p>In a third step we estimate which firm characteristics determine a substitution strategy as defined above. We find that the probability of a firm following a substitution strategy increases with lower capital equipment, with the absence of works council, with a higher share of white collar workers and in smaller companies. We further find that service sector firms have a significantly higher probability to follow a substitution strategy than manufacturing firms and complementarities between firms' investments in initial training and firm sponsored continuing training.</p><p>Our findings complement previous empirical analyzes. Previous studies about the training motivation require cost benefit data but this data can not be linked to other data sets and lack a panel dimension by construction. The within‐firm retention rate allows now a suitable approximation of the training motivation in Social Security Records and the IAB Establishment Panel. The training motivation is political and scientific important because companies with a substitution strategy employ apprentices because of their lower unit labour costs and, thus, they react strongly to relative wages of apprentices. Their decisions may be in sharp contrast to the decisions taken by firms training apprentices according to an investment strategy because the latter care more about future returns and training quality rather than lower wages of apprentices. Thus we conclude that a sound analysis of apprenticeship training and its determinants first needs to distinguish firms training according to an investment or a substitution strategy. This classification can further be used to test theories about company sponsored general training.</p></sec><sec><fig position="float" id="F_0160310503001"><label><bold>Figure 1<x> </x></bold></label><caption><p>The pooled cross‐section retention rate and the within‐firm retention rate of apprenticeship graduates in the year 2003</p></caption><graphic xlink:href="0160310503001.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503002"><label><bold>Figure 2<x> </x></bold></label><caption><p>Comparison of the substitution strategy by firm size between the within‐firm retention rates and the cost benefit analyzes of <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref></p></caption><graphic xlink:href="0160310503002.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503003"><label><bold>Figure A1<x> </x></bold></label><caption><p>Within firm retention rate distribution of apprenticeship graduates by minimum observations increase</p></caption><graphic xlink:href="0160310503003.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503004"><label><bold>Table I<x> </x></bold></label><caption><p>Marginal effects of a probit regression</p></caption><graphic xlink:href="0160310503004.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503005"><label><bold>Table AI<x> </x></bold></label><caption><p>Descriptive statistics, all classified companies in 2003</p></caption><graphic xlink:href="0160310503005.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503006"><label><bold>Table AII<x> </x></bold></label><caption><p>Descriptive statistics, substitution strategy companies in 2003</p></caption><graphic xlink:href="0160310503006.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503007"><label><bold>Table AIII<x> </x></bold></label><caption><p>Descriptive statistics, investment strategy companies in 2003</p></caption><graphic xlink:href="0160310503007.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503008"><label><bold>Table AIV<x> </x></bold></label><caption><p>Marginal effects of probit regression in different years, with the same cut‐off point 20/80, the 2003 regression is reported in the text</p></caption><graphic xlink:href="0160310503008.tif"></graphic></fig></sec><sec><fig position="float" id="F_0160310503009"><label><bold>Table AV<x> </x></bold></label><caption><p>Marginal effects of probit regression with different cut‐off points in 2003, the 20/80 regression is reported in the text</p></caption><graphic xlink:href="0160310503009.tif"></graphic></fig></sec></body><back><fn-group><title>Notes</title><fn id="fn1"><p>This refers to the full cost account which is usually cited in scientific papers.</p></fn><fn id="fn2"><p>The cost benefit study of <xref ref-type="bibr" rid="b3">Beicht <italic>et al.</italic> (2004)</xref> comprises two estimations. Here, we report only the full cost approach, because this is always cited in scientific publication. Both approaches are shown in section four.</p></fn><fn id="fn3"><p>The German cost benefit studies use three year average retention rate to estimate the benefits of the apprentices training, but they do not report the rates.</p></fn><fn id="fn4"><p>In the investment strategy the investment period is defined as the training period and the return period is defined as the employment of own apprenticeship graduates.</p></fn><fn id="fn5"><p>The <italic>Berufsbildungsbericht</italic> as well as the study of <xref ref-type="bibr" rid="b22">Schwerdt and Bender (2003)</xref> use the weighted retention rates, whereby the weight is the inverse of the sample probability to the IAB Establishment Panel. The weighting leads to a 10 percent lower retention rate on average.</p></fn><fn id="fn6"><p>The retention rate distribution remains stable if we extent the minimal observation of graduates to 4 and 5 years but the number of observations naturally decreases (see the Appendix). This especially occurs in small firms which train only one apprentice.</p></fn><fn id="fn7"><p>If we vary the training strategy cutting points between 15/85 and 25/75 percent the summary statistics remain stable, but logical, there changes the number of companies. All following results are additionally calculated for different cut off points, which are shown (see the Appendix).</p></fn><fn id="fn8"><p>In around 4 percent of the companies, we observe that no apprenticeship graduate is hired in one year and all graduates are hired in all other years. The other way around is observed in around 1.5 percent of the firms.</p></fn><fn id="fn9"><p>Apprentices are not counted as employees.</p></fn><fn id="fn10"><p>We modelled a continuous concave function of the firm size, but the maximum lies outside the observed firm size distribution.</p></fn><fn id="fn11"><p>This paper analyzes the mobility based on the companies view. 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He graduated in 2005. Since then he has been studying for his PhD and working as research assistant at the Institute for Strategy and Business Economics at the University of Zurich (Switzerland). He was visiting scholar at the University of Warwick in 2008. Jens Mohrenweiser is the corresponding author and can be contacted at: jens.mohrenweiser@isu.uzh.ch</p><p>Uschi Backes‐Gellner studied Economics at the University of Trier (Germany). She obtained her PhD from the same university in 1987 and her Venia Legendi in Business Economics in 1995. Afterwards, she got a full professorship at the University of Cologne (Germany). She was visiting scholar at several universities in the USA, such as Northwestern University, the University of California at Berkeley and Cornell University. Since 2002 she has held a chair for Personnel and Business Economics at the University of Zurich. At present she is also co‐director of the Swiss Leading House “Economics of Education, Firm Behaviour and Training Policies”.</p></app></app-group></back></article></istex:document></istex:metadataXml><mods version="3.6"><titleInfo lang="en"><title>Apprenticeship training for investment or substitution</title></titleInfo><titleInfo type="alternative" lang="en" contentType="CDATA"><title>Apprenticeship training for investment or substitution</title></titleInfo><name type="personal"><namePart type="given">Uschi</namePart><namePart type="family">BackesGellner</namePart></name><name type="personal"><namePart type="given">Uschi</namePart><namePart type="family">BackesGellner</namePart><role><roleTerm type="text">editor</roleTerm></role></name><name type="personal"><namePart type="given">Jens</namePart><namePart type="family">Mohrenweiser</namePart><affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</affiliation><role><roleTerm type="text">author</roleTerm></role></name><name type="personal"><namePart type="given">Uschi</namePart><namePart type="family">BackesGellner</namePart><affiliation>University of Zurich and Swiss Leading House on Economics of Education Firm Behavior and Training Policies, Zurich, Switzerland</affiliation><role><roleTerm type="text">author</roleTerm></role></name><typeOfResource>text</typeOfResource><genre type="research-article" displayLabel="research-article"></genre><originInfo><publisher>Emerald Group Publishing Limited</publisher><dateIssued encoding="w3cdtf">2010-08-17</dateIssued><copyrightDate encoding="w3cdtf">2010</copyrightDate></originInfo><language><languageTerm type="code" authority="iso639-2b">eng</languageTerm><languageTerm type="code" authority="rfc3066">en</languageTerm></language><physicalDescription><internetMediaType>text/html</internetMediaType></physicalDescription><abstract>Purpose The purpose of this paper is to derive an empirical method to identify different types of training strategies of companies based on publicly available company data. Designmethodologyapproach Using a tenyear panel, the withinfirm retention rate, defined as the average proportion of apprentices staying in a company in relation to all apprenticeship graduates of a company over several years, was analyzed. The withinfirm retention rate is used to identify these companies' training strategies. Findings It was shown that companies' motivation for apprenticeship training in Germany is not homogeneous 19 percent of all companies follow a substitution strategy and 44 percent follow an investment strategy. The determinants of the substitution strategy were estimated and, for example, sizeable differences were found between sectors with different skill requirements and between firms' coverage of industrial relations. Research limitationsimplications The method is well suited to classify substitutionmotivated training firms but it is less precise in identifying the investment motivation. Moreover, very small firms which train only one apprentice need longer panel duration for precise results and therefore the classification results are less precise for very small firms. Practical implications The classification can be used to identify determinants of company participation in apprenticeship training and to predict changes in demand for apprentices. Originalityvalue A simple and innovative method of identifying different types of training motivation with publicly available company data was derived, which has so far been possible only with very detailed companyspecific apprenticeship surveys.</abstract><subject><genre>keywords</genre><topic>Apprenticeships</topic><topic>Training</topic><topic>Human capital</topic></subject><relatedItem type="host"><titleInfo><title>International Journal of Manpower</title></titleInfo><genre type="journal">journal</genre><subject><genre>Emerald Subject Group</genre><topic authority="SubjectCodesPrimary" authorityURI="cat-ECO">Economics</topic></subject><identifier type="ISSN">0143-7720</identifier><identifier type="PublisherID">ijm</identifier><identifier type="DOI">10.1108/ijm</identifier><part><date>2010</date><detail type="title"><title>Economics of vocational education and training policies</title></detail><detail type="volume"><caption>vol.</caption><number>31</number></detail><detail type="issue"><caption>no.</caption><number>5</number></detail><extent unit="pages"><start>545</start><end>562</end></extent></part></relatedItem><identifier type="istex">7C30AEEF3EDA2ABCECD3BCA3C9F1778676432610</identifier><identifier type="DOI">10.1108/01437721011066353</identifier><identifier type="filenameID">0160310503</identifier><identifier type="original-pdf">0160310503.pdf</identifier><identifier type="href">01437721011066353.pdf</identifier><accessCondition type="use and reproduction" contentType="copyright">© Emerald Group Publishing Limited</accessCondition><recordInfo><recordContentSource>EMERALD</recordContentSource></recordInfo></mods></metadata><serie></serie></istex></record>Pour manipuler ce document sous Unix (Dilib)
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