On the impact of the TFP growth on the employment rate: does training on-the-job matter?
AbstractThis paper seeks to gain insights on the relationship between growth and unemployment when considering heterogeneous agents in terms of skills. We allow for the possibility of training for unskilled employed workers and for the possibility of human capital depreciation for skilled unemployed workers. These features are introduced in an endogenous job destruction framework µa la Mortensen and Pissarides (1998). We show that, when growth accelerates, a larger share of unskilled workers gets trained, increasing the incentives of ¯rms to update the job-speci¯c technology, rather than destroying it. The positive impact of growth on the employment rate is then magni¯ed and the predicting ability of the model to reproduce the sensibility of employment with respect to growth too. When calibrated, the model manages to reproduce the aggregate capitalization e®ect estimated on the basis of OECD data. Fur- thermore, whereas for skilled and unskilled workers getting trained growth yields a reduction in the unemployment rates, for unskilled workers not getting trained growth fosters a rise in the unemployment rates.
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Bibliographic InfoPaper provided by CEPREMAP in its series CEPREMAP Working Papers (Docweb) with number 1022.
Length: 33 pages
Date of creation: Sep 2010
Date of revision:
TFP growth; Unemployment; Training; Human Capital Depreciation; Capitalization; Creative Destruction Effect;
Other versions of this item:
- Eva Moreno-Galbis, 2010. "On the impact of the TFP growth on the employment rate: does training on-the-job matter?," Working Papers halshs-00812061, HAL.
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-04-16 (All new papers)
- NEP-DGE-2011-04-16 (Dynamic General Equilibrium)
- NEP-FDG-2011-04-16 (Financial Development & Growth)
- NEP-HRM-2011-04-16 (Human Capital & Human Resource Management)
- NEP-LAB-2011-04-16 (Labour Economics)
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.:
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