Advanced Search
MyIDEAS: Login to save this paper or follow this series

Performance Pay, Training and Labor Mobility

Contents:

Author Info

  • Gielen, Anne C.

    ()
    (Erasmus University Rotterdam)

Abstract

Market imperfections may cause firms and workers to under-invest in specific training. This paper shows that profit sharing may be a suitable instrument to enhance specific training investments, either by enhancing wage flexibility or by increasing the returns to training. As a result, profit sharing not only increases productivity by means of an effort effect, but also by increased training investments. Furthermore, the results suggest that older workers' employability can be improved if a profit-related remuneration is paid.

Download Info

If 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.
File URL: http://ftp.iza.org/dp2932.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2932.

as in new window
Length: 30 pages
Date of creation: Jul 2007
Date of revision:
Handle: RePEc:iza:izadps:dp2932

Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information:
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:

Related research

Keywords: profit-related pay; training; labor productivity; labor mobility;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
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.:
as in new window
  1. Wiji Arulampalam & Alison L. Booth & Mark L. Bryan, 2004. "Training in Europe," Journal of the European Economic Association, MIT Press, MIT Press, vol. 2(2-3), pages 346-360, 04/05.
  2. Daron Acemoglu & Joern-Steffen Pischke, 1998. "Beyond Becker: Training in Imperfect Labor Markets," Working papers, Massachusetts Institute of Technology (MIT), Department of Economics 98-12, Massachusetts Institute of Technology (MIT), Department of Economics.
  3. Cahuc, P. & Dormont, B., 1992. "Profit-Sharing: Does It Increase Productivity and Employment? A Theoretical Model and Empirical Evidence of French Micro Data," Papiers d'Economie Mathématique et Applications, Université Panthéon-Sorbonne (Paris 1) 92.45, Université Panthéon-Sorbonne (Paris 1).
  4. Lorraine Dearden & Howard Reed & John Van Reenen, 2005. "The impact of training on productivity and wages: evidence from British panel data," IFS Working Papers, Institute for Fiscal Studies W05/16, Institute for Fiscal Studies.
  5. Gielen, Anne & van Ours, Jan C, 2006. "Why Do Worker-Firm Matches Dissolve?," CEPR Discussion Papers, C.E.P.R. Discussion Papers 5739, C.E.P.R. Discussion Papers.
  6. Mark A. Loewenstein & James R. Spletzer, 1999. "General and Specific Training: Evidence and Implications," Journal of Human Resources, University of Wisconsin Press, vol. 34(4), pages 710-733.
  7. Acemoglu, D. & Pischki, J.S., 1996. "Why Do Firms Train? Theory and Evidence," Working papers, Massachusetts Institute of Technology (MIT), Department of Economics 96-7, Massachusetts Institute of Technology (MIT), Department of Economics.
  8. Harley Frazis & Mark A. Loewenstein, 2005. "Reexamining the Returns to Training: Functional Form, Magnitude, and Interpretation," Journal of Human Resources, University of Wisconsin Press, vol. 40(2).
  9. Daniel Parent, 2002. "Incentives? The Effect of Profit Sharing Plans Offered by Previous Employers on Current Wages," CIRANO Working Papers, CIRANO 2002s-54, CIRANO.
  10. Benoit Dostie, 2011. "Wages, Productivity and Aging," De Economist, Springer, Springer, vol. 159(2), pages 139-158, June.
  11. Gielen, Anne C. & Kerkhofs, Marcel & van Ours, Jan C., 2006. "Performance Related Pay and Labor Productivity," IZA Discussion Papers 2211, Institute for the Study of Labor (IZA).
  12. Gielen, Anne C. & van Ours, Jan C., 2006. "Age-specific cyclical effects in job reallocation and labor mobility," Labour Economics, Elsevier, Elsevier, vol. 13(4), pages 493-504, August.
  13. Mark A. Loewenstein & James R. Spletzer, 1997. "Delayed formal on-the-job training," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 51(1), pages 82-99, October.
  14. Lynch, Lisa M, 1992. "Private-Sector Training and the Earnings of Young Workers," American Economic Review, American Economic Association, American Economic Association, vol. 82(1), pages 299-312, March.
  15. Edwin Leuven, 2005. "The Economics of Private Sector Training: A Survey of the Literature," Journal of Economic Surveys, Wiley Blackwell, Wiley Blackwell, vol. 19(1), pages 91-111, 02.
  16. Alison L. Booth & Mark L. Bryan, 2005. "Testing Some Predictions of Human Capital Theory: New Training Evidence from Britain," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 391-394, May.
  17. G. S. Maddala & Lung-Fei Lee, 1976. "Recursive Models with Qualitative Endogenous Variables," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 5, number 4, pages 525-545 National Bureau of Economic Research, Inc.
  18. Booth, Alison L & Frank, Jeff, 1999. "Earnings, Productivity, and Performance-Related Pay," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 17(3), pages 447-63, July.
  19. Ewing, Bradley T., 1996. "Wages and performance-based pay: Evidence from the NLSY," Economics Letters, Elsevier, Elsevier, vol. 51(2), pages 241-246, May.
  20. Loewenstein, Mark A & Spletzer, James R, 1998. "Dividing the Costs and Returns to General Training," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 16(1), pages 142-71, January.
  21. Gathmann, Christina & Schönberg, Uta, 2006. "How General Is Specific Human Capital?," IZA Discussion Papers 2485, Institute for the Study of Labor (IZA).
  22. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
  23. 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.
  24. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Kraft, Kornelius & Lang, Julia, 2011. "Profit Sharing and Training," IZA Discussion Papers 6118, Institute for the Study of Labor (IZA).
  2. Carla Haelermans & Lex Borghans, 2012. "Wage Effects of On-the-Job Training: A Meta-Analysis," British Journal of Industrial Relations, London School of Economics, vol. 50(3), pages 502-528, 09.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp2932. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.