On-the-job training and starting wages

Human capital theory predicts that training should reduce starting wages, yet this rela-tionship remains empirically undocumented. Estimation of how training affects wages must control heterogeneity bias. I do this by estimating firstdifference starting wage regressions on a sample of workers from the Employment Opportunities Pilot Project (EOPP) data. I find that on-the-job training has a statistically significant effect on starting wages.