Impact of High Quality Training on Productivity: Evidence from an Intervention in Retail

This paper seeks to evaluate the effect of a training intervention on skills development and labor market productivity. It also aims to measure to what extent the observed impact on productivity could be attributed to the... [ view full abstract ]

This paper seeks to evaluate the effect of a training intervention on skills development and labor market productivity. It also aims to measure to what extent the observed impact on productivity could be attributed to the observed effect on skills. The paper evaluates the effects of a training intervention on measures of labor market productivity in the context of one of the largest retail firms in Latin America. The training was designed to boost two specific skills - leadership and communication -, which were identified as critical during the design of the intervention. Our identification strategy relies on the experimental design as well as individual-level longitudinal information gathered from the firm. We examine the mechanisms through which training might impact productivity both at the individual and firm levels. Our data is unique as it contains rich worker level information. Our estimates suggest large effects of the training program on sales and transaction per worker. This result is confirmed in our cost-benefit analysis. Our findings point towards the feasibility of increasing productivity with a high quality, well-designed and optimally-delivered training program targeted to increase skills pre-identified as crucial in the productive process of the firm.