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Skill, Training, Organisational Commitment and Unemployment: The Economics of a Labour Strategy Management


  • F Green


This paper argues that trainging often has a wider role than just the acquisition of technical skills and that company training ought to be analysed as part of a broader labour management strategy for companies. Evidence is adduced for this, drawing on both ecnomic and management literatures, and in particular on analyses of organisational commitment. A micro model of human capital acquisition in the firm is examined, and it is shown that different human resource policies are mutually reinforcing. A macro model of efficiency wages is also developed, but one that is modified by the presence of a labour management strategy. It is shown that the strategy tends to reduce both unemployment and wages, and to have ambiguous effects on welfare. It is suggested that variations in organisational commitments and associated labour management strategies, can account for some basic stylised facts about the distribution of unemployment.

Suggested Citation

  • F Green, 1996. "Skill, Training, Organisational Commitment and Unemployment: The Economics of a Labour Strategy Management," CEP Discussion Papers dp0313, Centre for Economic Performance, LSE.
  • Handle: RePEc:cep:cepdps:dp0313

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    References listed on IDEAS

    1. Puga, Diego & Venables, Anthony J., 1996. "The Spread of Industry: Spatial Agglomeration in Economic Development," Journal of the Japanese and International Economies, Elsevier, vol. 10(4), pages 440-464, December.
    2. Decressin, Jorg & Fatas, Antonio, 1995. "Regional labor market dynamics in Europe," European Economic Review, Elsevier, vol. 39(9), pages 1627-1655, December.
    3. Hanson, Gordon H., 1998. "Regional adjustment to trade liberalization," Regional Science and Urban Economics, Elsevier, vol. 28(4), pages 419-444, July.
    4. Quah, Danny T., 1996. "Regional convergence clusters across Europe," European Economic Review, Elsevier, vol. 40(3-5), pages 951-958, April.
    5. Paul Krugman & Anthony J. Venables, 1995. "Globalization and the Inequality of Nations," The Quarterly Journal of Economics, Oxford University Press, vol. 110(4), pages 857-880.
    6. Fujita,Masahisa & Thisse,Jacques-François, 2013. "Economics of Agglomeration," Cambridge Books, Cambridge University Press, number 9781107001411, March.
    7. Olivier Jean Blanchard & Lawrence F. Katz, 1992. "Regional Evolutions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(1), pages 1-76.
    8. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
    9. Gianmarco I. P. Ottaviano & Diego Puga, 1998. "Agglomeration in the Global Economy: A Survey of the 'New Economic Geography'," The World Economy, Wiley Blackwell, vol. 21(6), pages 707-731, August.
    10. Puga, Diego & Venables, Anthony J., 1997. "Preferential trading arrangements and industrial location," Journal of International Economics, Elsevier, vol. 43(3-4), pages 347-368, November.
    11. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    12. Puga, Diego, 1996. "Urbanisation patterns: European vs less developed countries," LSE Research Online Documents on Economics 20656, London School of Economics and Political Science, LSE Library.
    13. Costas Megir & Danny Quah, 1996. "Regional Convergence Clusters Across Europe," CEP Discussion Papers dp0274, Centre for Economic Performance, LSE.
    14. Hanson, Gordon H, 1997. "Increasing Returns, Trade and the Regional Structure of Wages," Economic Journal, Royal Economic Society, vol. 107(440), pages 113-133, January.
    15. Brülhart, Marius, 1996. "Regional Integration, Scale Economies and Industry Location in the European Union," CEPR Discussion Papers 1435, C.E.P.R. Discussion Papers.
    16. Helpman, E., 1995. "The Size of Regions," Papers 14-95, Tel Aviv.
    17. Venables, Anthony J, 1996. "Equilibrium Locations of Vertically Linked Industries," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(2), pages 341-359, May.
    18. repec:hhs:iuiwop:430 is not listed on IDEAS
    19. Bentolila, Samuel & Jimeno, Juan F, 1995. "Regional Unemployment Persistence (Spain, 1976-94)," CEPR Discussion Papers 1259, C.E.P.R. Discussion Papers.
    20. Quah, Danny, 1996. "Regional Convergence Clusters Across Europe," CEPR Discussion Papers 1286, C.E.P.R. Discussion Papers.
    21. Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June.
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    Cited by:

    1. Dearden, Lorraine & Reed, Howard & Van Reenen, John, 2000. "Who Gains when Workers Train? Training and Corporate Productivity in a Panel of British Industries," CEPR Discussion Papers 2486, C.E.P.R. Discussion Papers.
    2. Rahmah Ismail & Zulridah Noor & Abd Awang, 2011. "Impact of Training under Human Resource Development Limited on Workers’ Mobility in Selected Malaysian Services Sector," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 1(2), pages 146-159, December.

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