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Firm-Sponsored General Training in Frictional Labour Markets: An Empirical Analysis for Switzerland

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  • Gerfin, Michael

    ()
    (University of Bern)

Abstract

According to the classical human capital theory general training is entirely financed by workers. This prediction is at odds with the empirical evidence. This observation inspired new theoretical models of training in frictional labour market. These frictions create incentives for firms to invest in general training. This paper tries to identify the sources of frictions in the Swiss labour market. The results indicate that internal wage floors may play an important role, especially for training in large firms. Overall, the empirical results support the predictions of the new training literature.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1077.

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Length: 20 pages
Date of creation: Mar 2004
Date of revision:
Handle: RePEc:iza:izadps:dp1077

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Keywords: training; wages; market imperfections; mobility;

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References

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  1. Daron Acemoglu & Jorn-Steffen Pischke, 1999. "The Structure of Wages and Investment in General Training," Journal of Political Economy, University of Chicago Press, vol. 107(3), pages 539-572, June.
  2. Booth, Alison L & Zoega, Gylfi, 2001. "Is Wage Compression a Necessary Condition for Firm-Financed General Training?," CEPR Discussion Papers 2845, C.E.P.R. Discussion Papers.
  3. Gerfin, Michael, 2004. "Work-Related Training and Wages: An Empirical Analysis for Male Workers in Switzerland," IZA Discussion Papers 1078, Institute for the Study of Labor (IZA).
  4. Stevens, Margaret, 1994. "A Theoretical Model of On-the-Job Training with Imperfect Competition," Oxford Economic Papers, Oxford University Press, vol. 46(4), pages 537-62, October.
  5. Pischke, J-S, 1996. "Continuous Training in Germany," Working papers 96-28, Massachusetts Institute of Technology (MIT), Department of Economics.
  6. John M. Barron & Mark C. Berger & Dan A. Black, 1997. "On-the-Job Training," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number ojt, December.
  7. Groot, Wim, 1995. "The Wage Effects of Investments in Enterprise-Related Training," Empirical Economics, Springer, vol. 20(1), pages 133-47.
  8. Goux, Dominique & Maurin, Eric, 2000. "Returns to firm-provided training: evidence from French worker-firm matched data1," Labour Economics, Elsevier, vol. 7(1), pages 1-19, January.
  9. Loewenstein, Mark A & Spletzer, James R, 1998. "Dividing the Costs and Returns to General Training," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 142-71, January.
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Citations

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Cited by:
  1. Bassanini, Andrea & Brunello, Giorgio, 2008. "Is training more frequent when the wage premium is smaller? Evidence from the European Community Household Panel," Labour Economics, Elsevier, vol. 15(2), pages 272-290, April.
  2. Picchio, M. & Ours, J.C. van, 2010. "Market Imperfections and Firm-Sponsored Training," Discussion Paper 2010-57, Tilburg University, Center for Economic Research.
  3. Asplund, Rita, 2004. "The Provision and Effects of Company Training. A brief review of the literature," Discussion Papers 907, The Research Institute of the Finnish Economy.
  4. Alfred Garloff & Anja Kuckulenz, 2006. "Training, Mobility, and Wages: Specific Versus General Human Capital," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 226(1), pages 55-81, January.
  5. Rita Asplund, 2005. "The Provision and Effects of Company Training: A Brief Review of the Literature," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 31, pages 47-73.

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