The Role of Specialized Knowledge and 'Know-How' for Firm Productivity: Evidence from the Equine Industry

Using matched employer-employee data, we investigate the influence of human capital inputs on firm productivity. Several variables are used to measure firms' access to skilled labor, such as their share of employees with occupation-specific education and experience in horse breeding and hippology and access to a local pool of skilled labour. The results show that occupation-specific training is associated with an average productivity premium of 11%, but there is significant intra-industry heterogeneity in the extent that firms that can gain from workers with specialized training. The results have implications for policy and the investment decisions made by firms.