Matching, Screening and Firm Investment in General Training: Theory and Evidence
AbstractWhen job matching is important, we show that firms will pay for general training under very weak conditions. The key ingredient in our model is the idea that it is more costly to screen skilled workers than it is to screen unskilled ones. In equilibrium, this 'softens' competition for trained workers, allowing firms to recoup training investments. We apply our model to a classic case of firm investment in general training - German Apprenticeship Training - and show that a key prediction of our model that is not shared by other models is strongly supported in the data.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by International Conferences on Panel Data in its series 10th International Conference on Panel Data, Berlin, July 5-6, 2002 with number A2-4.
Date of creation: Apr 2002
Date of revision:
Contact details of provider:
General Training; Human Capital; Auctions; Wages;
Find related papers by JEL classification:
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- David H. Autor, 2000.
"Why Do Temporary Help Firms Provide Free General Skills Training?,"
NBER Working Papers
7637, National Bureau of Economic Research, Inc.
- David H. Autor, 2001. "Why Do Temporary Help Firms Provide Free General Skills Training?," The Quarterly Journal of Economics, MIT Press, vol. 116(4), pages 1409-1448, November.
- Daron Acemoglu & Jörn-Steffen Pischke, 1998.
"Why Do Firms Train? Theory And Evidence,"
The Quarterly Journal of Economics,
MIT Press, vol. 113(1), pages 78-118, February.
- Acemoglu, D. & Pischki, J.S., 1996. "Why Do Firms Train? Theory and Evidence," Working papers 96-7, Massachusetts Institute of Technology (MIT), Department of Economics.
- Daron Acemoglu & Jorn-Steffen Pischke, 1996. "Why Do Firms Train? Theory and Evidence," NBER Working Papers 5605, National Bureau of Economic Research, Inc.
- Acemoglu, Daron & Pischke, Jörn-Steffen, 1996. "Why do Firms Train? Theory and Evidence," CEPR Discussion Papers 1460, C.E.P.R. Discussion Papers.
- Wagner, Karin, 1998. "The German apprenticeship system after unification," Discussion Papers, Research Unit: Economic Change and Employment FS I 98-301, Social Science Research Center Berlin (WZB).
- Euwals, Rob & Winkelmann, Rainer, 2001.
"Why do Firms Train? Empirical Evidence on the First Labour Market Outcomes of Graduate Apprentices,"
CEPR Discussion Papers
2880, C.E.P.R. Discussion Papers.
- Euwals, Rob & Winkelmann, Rainer, 2001. "Why Do Firms Train? Empirical Evidence on the First Labour Market Outcomes of Graduated Apprentices," IZA Discussion Papers 319, Institute for the Study of Labor (IZA).
- Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 9.
- Chang, Chun & Wang, Yijiang, 1996. "Human Capital Investment under Asymmetric Information: The Pigovian Conjecture Revisited," Journal of Labor Economics, University of Chicago Press, vol. 14(3), pages 505-19, July.
- A. Werwatz, 1996. "How firm-specific is German apprenticeship training?," SFB 373 Discussion Papers 1996,12, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
- David Soskice, 1994. "Reconciling Markets and Institutions: The German Apprenticeship System," NBER Chapters, in: Training and the Private Sector, pages 25-60 National Bureau of Economic Research, Inc.
- Dietmar Harhoff & Thomas J. Kane, 1993. "Financing Apprenticeship Training: Evidence from Germany," NBER Working Papers 4557, National Bureau of Economic Research, Inc.
- Topel, Robert H & Ward, Michael P, 1992.
"Job Mobility and the Careers of Young Men,"
The Quarterly Journal of Economics,
MIT Press, vol. 107(2), pages 439-79, May.
- Steven A. Matthews, 1995. "A Technical Primer on Auction Theory I: Independent Private Values," Discussion Papers 1096, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- McAfee, R. Preston & McMillan, John, 1987. "Auctions with entry," Economics Letters, Elsevier, vol. 23(4), pages 343-347.
- repec:wop:humbsf:1996-12 is not listed on IDEAS
- Milgrom, Paul & Roberts, John, 1982.
"Limit Pricing and Entry under Incomplete Information: An Equilibrium Analysis,"
Econometric Society, vol. 50(2), pages 443-59, March.
- Paul Milgrom & John Roberts, 1998. "Limit Pricing and Entry Under Incomplete Information: An Equilibrium Analysis," Levine's Working Paper Archive 245, David K. Levine.
- Scoones, David, 2000. "Matching and competition for human capital," Labour Economics, Elsevier, vol. 7(2), pages 135-152, March.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sune Karlsson).
If references are entirely missing, you can add them using this form.