The effect of subsidizing continuous training investments -- Evidence from German establishment data

This paper evaluates the impact of a training voucher program on establishments' investments in further training. The voucher program that was implemented in the German federal state of North Rhine-Westphalia increased training incentives for employees in small and medium-sized establishments by reducing training costs by 50%. The estimation is based on a quasi-experimental research design exploiting variation across time, regions and establishment size. Using establishment data, I find that the share of establishments that invest in training increased by 4-6 percentage points. Training intensity and the educational structure of participants remained unaffected among those establishments investing in training.