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Research ArticleArticle

Locus of Control and Investment in Training

Marco Caliendo, Deborah A. Cobb-Clark, Cosima Obst, Helke Seitz and Arne Uhlendorff
Published online before print June 10, 2020, 0318-9377R2; DOI: https://doi.org/10.3368/jhr.57.4.0318-9377R2
Marco Caliendo
University of Potsdam, IZA, DIW, IAB
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Deborah A. Cobb-Clark
University of Sydney, IZA, ARC Life Course Centre
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Cosima Obst
University of Potsdam
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Helke Seitz
DIW Berlin
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Arne Uhlendorff
CREST, CNRS, IAB, IZA, DIW
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Abstract

We extend standard models of work-related training by explicitly incorporating workers’ locus of control into the investment decision through the returns they expect. Our model predicts that higher internal control results in increased take-up of general, but not specific, training. This prediction is empirically validated using data from the German Socioeconomic Panel (SOEP). We provide empirical evidence that locus of control influences participation in training through its effect on workers’ expectations about future wage increases rather than actual wage increases. Our results provide an important explanation for under-investment in training and suggest that those with an external sense of control may require additional training support.

Keywords
  • Human Capital Investment
  • On-the-job Training
  • Locus of Control
  • Wage Expectations
JEL codes
  • J24
  • C23
  • D84

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Journal of Human Resources: 60 (3)
Journal of Human Resources
Vol. 60, Issue 3
1 May 2025
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Locus of Control and Investment in Training
Marco Caliendo, Deborah A. Cobb-Clark, Cosima Obst, Helke Seitz, Arne Uhlendorff
Journal of Human Resources Jun 2020, 0318-9377R2; DOI: 10.3368/jhr.57.4.0318-9377R2

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Locus of Control and Investment in Training
Marco Caliendo, Deborah A. Cobb-Clark, Cosima Obst, Helke Seitz, Arne Uhlendorff
Journal of Human Resources Jun 2020, 0318-9377R2; DOI: 10.3368/jhr.57.4.0318-9377R2
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Keywords

  • Human capital investment
  • On-the-job Training
  • Locus of Control
  • Wage Expectations
  • J24
  • C23
  • D84
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