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Specificity of Occupational Training and Occupational Mobility: An Empirical Study Based on Lazear’s Skill-Weights Approach

  • Regula Geel


    (Institute for Strategy and Business Economics, University of Zurich)

  • Johannes Mure


    (Institute for Strategy and Business Economics, University of Zurich)

  • Uschi Backes-Gellner


    (Institute for Strategy and Business Economics, University of Zurich)

According to standard human capital theory firm financed training cannot be explained if skills are of general nature. Nevertheless, investments of firms into general training can be observed and there has been a large literature to explain this puzzle, mostly referring to imperfect labor market issues. In German speaking countries firms invest heavily into apprenticeship training although it is assumed to be general. In our paper, we study the question to what extent apprenticeship training is general at all. Our paper for the first time studies how specificity of training may be defined based on Lazear’s skill-weights approach. In our empirical part we use a unique German Qualification Survey, containing extensive information about the required skills at a workplace. We build occupationspecific skill-weights and find that the more specific the skill portfolio in an occupation is in comparison to the general labor market, the higher are the net costs firms have to bear for apprenticeship training in the respective occupations. At the same time, the more specific the skill requirements are in an occupation, the smaller is the probability of an occupational change during an employee’s entire career. Due to the new definition of occupational specificity, we thus find that apprenticeship training - formerly seen as general training - is very heterogeneous in its specificity.

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Paper provided by University of Zurich, Institute for Strategy and Business Economics (ISU) in its series Economics of Education Working Paper Series with number 0038.

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Length: 24 pages
Date of creation: Nov 2008
Date of revision:
Handle: RePEc:iso:educat:0038
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  1. Harhoff, Dietmar & Kane, Thomas J, 1996. "Is the German Apprenticeship System a Panacea for the US Labour Market?," CEPR Discussion Papers 1311, C.E.P.R. Discussion Papers.
  2. 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.
  3. Euwals, Rob & Winkelmann, Rainer, 2001. "Why do Firms Train? Empirical Evidence on the First Labour Market Outcomes of Graduate Apprentices," CEPR Discussion Papers 2880, C.E.P.R. Discussion Papers.
  4. Katz, Eliakim & Ziderman, Adrian, 1990. "Investment in General Training: The Role of Information and Labour Mobility," Economic Journal, Royal Economic Society, vol. 100(403), pages 1147-58, December.
  5. Edward P. Lazear, 2003. "Firm-Specific Human Capital: A Skill-Weights Approach," NBER Working Papers 9679, National Bureau of Economic Research, Inc.
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