Human Capital and Competition: Strategic Complementarities in Firm-based Training
AbstractVocational training systems differ markedly between countries. A model of firm-based human capital investment predicts equilibria characterised by particular patterns of training and job-to-job mobility, consistent with observed cross-country differences. Incentives to invest in human capital are determined jointly with labour turnover and the intensity of competition between employers for skilled workers, and the dependence of labour market conditions on human capital leads to strategic complementarity between training decisions. Depending on the extent of market frictions and match heterogeneity, we may expect to see either equilibria characterised by general training, steep wage profiles and high mobility; or equilibria in which both general and specific investment may occur, but turnover is low and wage profiles are relatively flat. Multiple equilibria are possible, in which case high turnover equilibria generate higher welfare. �
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 University of Oxford, Department of Economics in its series Economics Series Working Papers with number 629.
Date of creation: 05 Nov 2012
Date of revision:
Human capital; labor turnover; specific training; general training; search; matching;
Find related papers by JEL classification:
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-02-03 (All new papers)
- NEP-DGE-2013-02-03 (Dynamic General Equilibrium)
- NEP-HRM-2013-02-03 (Human Capital & Human Resource Management)
- NEP-KNM-2013-02-03 (Knowledge Management & Knowledge Economy)
- NEP-LMA-2013-02-03 (Labor Markets - Supply, Demand, & Wages)
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.:
- Bassanini, Andrea & Booth, Alison L. & Brunello, Giorgio & De Paola, Maria & Leuven, Edwin, 2005. "Workplace Training in Europe," IZA Discussion Papers 1640, Institute for the Study of Labor (IZA).
- Mohrenweiser, Jens & Zwick, Thomas, 2008.
"Why Do Firms Train Apprentices? The Net Cost Puzzle Reconsidered,"
ZEW Discussion Papers
08-019, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Mohrenweiser, Jens & Zwick, Thomas, 2009. "Why do firms train apprentices? The net cost puzzle reconsidered," Labour Economics, Elsevier, vol. 16(6), pages 631-637, December.
- Jens Mohrenweiser & Thomas Zwick, 2008. "Why do Firms Train Apprentices? The Net Cost Puzzle Reconsidered," Economics of Education Working Paper Series 0016, University of Zurich, Institute for Strategy and Business Economics (ISU), revised Oct 2008.
- Daniel Parent, 1995.
"Wages and Mobility: The Impact of Employer-Provided Training,"
CIRANO Working Papers
- Parent, Daniel, 1999. "Wages and Mobility: The Impact of Employer-Provided Training," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 298-317, April.
- Parent, D., 1995. "Wages and Mobility: the Impact of Employer-Provided Training," Cahiers de recherche 9507, Universite de Montreal, Departement de sciences economiques.
- Laing, Derek & Palivos, Theodore & Wang, Ping, 1995. "Learning, Matching and Growth," Review of Economic Studies, Wiley Blackwell, vol. 62(1), pages 115-29, January.
- Anke S. Kessler & Christoph Lülfesmann, 2006.
"The Theory of Human Capital Revisited: on the Interaction of General and Specific Investments,"
Royal Economic Society, vol. 116(514), pages 903-923, October.
- Anke S. Kessler & Christoph Lülfesmann, 2002. "The Theory of Human Capital Revisited: On the Interaction of General and Specific Investments," CESifo Working Paper Series 776, CESifo Group Munich.
- Kessler, Anke & Lülfesmann, Christoph, 2000. "The Theory of Human Capital Revisited: On the Interaction of General and Specific Investments," CEPR Discussion Papers 2533, C.E.P.R. Discussion Papers.
- Christoph Luelfesmann, 2000. "The Theory of Human Capital Revisited: On the Interaction of General and Specific Investments," Econometric Society World Congress 2000 Contributed Papers 0659, Econometric Society.
- 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.
- Scoones, David, 2000. "Matching and competition for human capital," Labour Economics, Elsevier, vol. 7(2), pages 135-152, March.
- Damon Clark & René Fahr, 2002.
"The Promise of Workplace Training for Non-College Bound Youth: Theory and Evidence from German Apprenticeship,"
CEP Discussion Papers
dp0518, Centre for Economic Performance, LSE.
- Clark, Damon & Fahr, René, 2001. "The Promise of Workplace Training for Non-College-Bound Youth: Theory and Evidence from German Apprenticeship," IZA Discussion Papers 378, Institute for the Study of Labor (IZA).
- Clark, Damon & RenÈ Fahr, 2002. "The Promise of Workplace Training for Non-College-Bound Youth: Theory and Evidence from German Apprenticeship," Royal Economic Society Annual Conference 2002 52, Royal Economic Society.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Caroline Wise).
If references are entirely missing, you can add them using this form.