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The Interaction of Firing Costs and Firm Training

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Author Info
Wolfgang Lechthaler ()
Abstract

This paper analyzes the effects of firing costs in a broader setup than what is usually done, allowing for on-the-job training. By doing so the traditional analysis is extended with respect to two points: On the one hand firing costs clearly increase firm training because worker and firm are less likely to separate. On the other hand, firm training gives firms the opportunity to lower the costs of firing restrictions: After all the value of output of a well-trained worker is less likely to turn negative. Through these two channels firm training is able to diminish the negative effects of firing restrictions usually discussed in the literature.

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File URL: http://www.vwa.unisg.ch/RePEc/usg/dp2006/DP01_Le.pdf
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Publisher Info
Paper provided by Department of Economics, University of St. Gallen in its series University of St. Gallen Department of Economics working paper series 2006 with number 2006-01.

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Length: 41 pages
Date of creation: Jan 2006
Date of revision:
Handle: RePEc:usg:dp2006:2006-01

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Related research
Keywords: Firm Training; Firing Costs; Human Capital;

Find related papers by JEL classification:
E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs
J68 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Public Policy
M53 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Training

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This page was last updated on 2009-12-2.

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