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Do Dominant Firms Provide More Training?
Author(s) -
Bilanakos Christos,
Green Colin P.,
Heywood John S.,
Theodoropoulos Nikolaos
Publication year - 2016
Publication title -
journal of economics and management strategy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.672
H-Index - 68
eISSN - 1530-9134
pISSN - 1058-6407
DOI - 10.1111/jems.12177
Subject(s) - endogeneity , competitor analysis , cournot competition , competition (biology) , profitability index , product market , incentive , economics , training (meteorology) , position (finance) , microeconomics , product (mathematics) , industrial organization , econometrics , finance , ecology , physics , geometry , mathematics , management , meteorology , biology
A canonical Cournot competition model shows that the profitability of training can increase as the number of competitors decreases. British establishment evidence from 1998, 2004, and 2011 confirms that firms in less competitive markets provide more formal training. This persists within three separate cross‐sections and in two separate panel estimates. It persists with alternative measures of training, with alternative measures of market competition and in estimates designed to account for endogeneity. These results suggest that a dominant product market position, indeed, increases the incentives to invest in training.