Fingold and Soskice (1988) argue that Britain is trapped in a "low-skills" equilibrium. In Redding (1996), this notion is formalized in a dynamic model which relies on strategic complementarities between firms' investments in R&D and workers' investments in human capital. In this paper, we investigate the firms' side of the story, notably wheher their investments in fixed capital and R&D are influenced by the avilability of human capital.
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Paper provided by Centre for Economic Performance & Institute of Economics in its series Papers with number
20.
Length: 28 pages Date of creation: 1997 Date of revision: Handle: RePEc:fth:cepies:20
Contact details of provider: Postal: United Kingdom; Centre for Economic Performance & Institute of Economics and Statistics, Oxford University. Manor Road. Oxford OX1 3Ul Email: Web page: http://www.economics.ox.ac.uk/ More information through EDIRC
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Find related papers by JEL classification: J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity O32 - Economic Development, Technological Change, and Growth - - Technological Change - - - Management of Technological Innovation and R&D
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