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Job competition, employability and incentives for human capital formation

Author

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  • Adolfo Cristobal Campoamor

    (University Loyola Andalusia)

Abstract

This note describes the effects on human capital formation of rank-order tournaments offering identical prizes to a given number of the ranked contestants. This compensation scheme is thought to resemble the selection processes in different areas of the public administration, particularly in Southern European countries. In the presence of contestants with identical ability, the incentives for educational effort are highest when the variance of fiÂ…nal returns is maximized.

Suggested Citation

  • Adolfo Cristobal Campoamor, 2015. "Job competition, employability and incentives for human capital formation," Economics Bulletin, AccessEcon, vol. 35(1), pages 550-560.
    • Handle: RePEc:ebl:ecbull:eb-14-01032
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    References listed on IDEAS

    as
    1. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-864, October.
    2. Carneiro, Pedro & Heckman, James J., 2003. "Human Capital Policy," IZA Discussion Papers 821, Institute of Labor Economics (IZA).
    3. Frédéric Docquier & Hillel Rapoport, 2012. "Globalization, Brain Drain, and Development," Journal of Economic Literature, American Economic Association, vol. 50(3), pages 681-730, September.
    4. Muhammad Asali & Adolfo Cristobal-Campoamor & Avner Shaked, 2016. "Local human capital formation and optimal FDI," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 25(5), pages 691-705, August.
    5. Daniel Mejía & Marc St-Pierre, 2007. "Human capital formation, inequality, and competition for jobs," Documentos CEDE 4105, Universidad de los Andes, Facultad de Economía, CEDE.
    6. Ludger Wößmann, 2008. "Efficiency and equity of European education and training policies," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 15(2), pages 199-230, April.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    human capital; tournaments; imperfect information; public sector; contests;
    All these keywords.

    JEL classification:

    • D0 - Microeconomics - - General
    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics

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