Does Work Experience Increase Productivity? A Test of the On-The-Job Training Hypothesis

Abstract

Using data on wage claims investigations of a state labor department, we test the proposition that work experience increases productivity. Productivity is measured as the fraction of wages an employer allegedly owes an employee which the investigator is able to collect. The recovery of back wages is accomplished without the availability of an official enforcement mechanism. The empirical estimates indicate that investigators become significantly more productive during the first six years of job experience. While the uniqueness of this occupation prevents generalizing this finding, the study raises some important methodological issues.