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Using company-level data from three waves of the Continuing Vocational Training Survey (2005, 2010 and 2015), this paper provides an overview on European firms implementing training and the magnitude of their training effort. We illustrate in the descriptive statistics that there are significant differences in the wage and employment performance across companies in relation to the digital content of their production and training activities. We conduct a regression analysis documenting that a wage premium of 9% is associated with companies undertaking training and that an additional 8% is paid by firms arranging training for IT skills-intensive workers. The latter effect is pervasive across sectors and is not strictly related to industry exposure to the digital transformation. We seek to address both the simultaneity and the selectivity issue of our data implementing an instrumental variable regression and a propensity score matching procedure.

This document contains an extensive literature review of the state-of-the-art related to the research in UNTANGLED work packages (WPs) 3 to 6. The literature covered relates to (a)the impact of the three mega-trends of technological transformations, globalisation and demographic changes, and how they affect labour markets and social outcomes (WPs 3 to 5); and (b)literature related to building scenarios for Europe (WP 6). The document is divided into four sections. Each of the first three sections is concerned with the effect of these trends at the macro (WP3), meso (WP4) or micro (WP5_ societal level. The last section looks at scenario building (WP6). It is a living document in the sense that throughout the project additional sources will be added to keep the literature review up to date.

We investigate the decline of the labor share in a world characterized by rapid technological changes and increasing heterogeneity of capital assets. Our theoretical model allows for these assets to affect the labor share in different directions depending on the capital-labor substitution/complementary relationship and the workers' skill level. We test the predictions of our model using a large cross-country, cross-industry data set, considering different forms of tangible and intangible capital inputs. Our results show that, over the 1970-2007 period, the decline of the labor share has been mainly driven by technical change and Information and Communication Technology (ICT) assets, mitigated by increasing investments in R&D-based knowledge assets. Extending to other forms of intangible capital from 1995 onwards, we find that intangible investments related to innovation increase the labor share while those related to the organisation of firms contribute to its decline, particularly for the low and intermediate skilled workers. Our results are robust to an array of econometric issues, namely heterogeneity, cross-sectional dependence, and endogeneity

This paper investigates whether off-shoring promotes technological specialization by reallocating resources towards high-tech industries and/or stimulating within industry R&D. Using data for the US, Japan and Europe, our results show that material off-shoring promotes high-tech specialization through input reallocation between sectors, while service off-shoring favours technologically advanced production by increasing within-industry productivity, mainly via its positive impact on R&D. Conversely, we find that the increasing fragmentation of core production tasks, captured by narrow off-shoring, has adverse effects on technological specialisation, which suggests that this type of off-shoring is mainly pursued for cost-reduction motives.

This study explores the channels through which technological investments affect productivity performance of industrialized economies. Using a Stochastic Frontier Model (SFM) we estimate the productivity effects of R&D and ICT for a large sample of OECD industries between 1973 and 2007, identifying four channels of transmission: input accumulation, technological change, technical efficiency and spillovers. Our results show that ICT has been particularly effective in reducing production inefficiency and in generating inter-industry spillovers, while R&D has raised the rate of technical change and favoured knowledge spillovers within sectors. We also quantify the contribution of technological investments to output and TFP growth documenting that R&D and ICT accounted for almost 95% of TFP growth in the OECD area.