IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

How Acid are Lemons? Adverse Selection and Signalling for Skilled Labour Market Entrants

  • Robert Wagner

    ()

    (Ludwig-Maximilians University, Munich)

  • Thomas Zwick

    ()

    (Ludwig-Maximilians University, Munich and Centre for European Economic Research, Mannheim)

This paper for the first time jointly analyses the consequences of adverse selection, signalling and indices on entry wages of skilled employees. It uses German linked employer employee panel data (LIAB) and introduces a measure for relative productivity of skilled job applicants based on apprenticeship wages. It shows that post-apprenticeship employer changers are a negative selection from the training firms’ point of view. Negative selection leads to lower average wages of employer changers in the first skilled job in comparison to stayers. Entry wages of employer changers are specifically reduced by high occupation and training firm retention rates. High apprenticeship wages signal a positive selection of apprenticeship applicants. Works councils and establishment size seem to be indices for good training quality. Finally, positive individual signals such as schooling background affect the skilled entry wages of employer changers positively.

If 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.

File URL: http://repec.business.uzh.ch/RePEc/iso/leadinghouse/0071_lhwpaper.pdf
Download Restriction: no

Paper provided by University of Zurich, Institute for Strategy and Business Economics (ISU) in its series Economics of Education Working Paper Series with number 0071.

as
in new window

Length: 41 pages
Date of creation: Jan 2012
Date of revision: Feb 2012
Handle: RePEc:iso:educat:0071
Contact details of provider: Postal:
Plattenstrasse 14, CH-8032 Zürich

Phone: ++41 1 634 29 27
Fax: ++41 1 634 43 48
Web page: http://www.isu.uzh.ch
Email:


More information through EDIRC

References listed on IDEAS
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.:

as in new window
  1. 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.
  2. Andrew Weiss, 1995. "Human Capital vs. Signalling Explanations of Wages," Journal of Economic Perspectives, American Economic Association, vol. 9(4), pages 133-154, Fall.
  3. Gibbons, Robert & Katz, Lawrence F., 1991. "Layoffs and Lemons," Scholarly Articles 3442782, Harvard University Department of Economics.
  4. Lars Behrenz, 2001. "Who Gets The Job And Why? An Explorative Study Of Employers’ Recruitment Behavior," Journal of Applied Economics, Universidad del CEMA, vol. 4, pages 255-278, November.
  5. Kahn, Lisa B., 2010. "The long-term labor market consequences of graduating from college in a bad economy," Labour Economics, Elsevier, vol. 17(2), pages 303-316, April.
  6. Neal, Derek, 1999. "The Complexity of Job Mobility among Young Men," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 237-61, April.
  7. Bruce C. Greenwald & Robert R. Glasspiegel, 1983. "Adverse Selection in the Market for Slaves: New Orleans, 1830–1860," The Quarterly Journal of Economics, Oxford University Press, vol. 98(3), pages 479-499.
  8. Iourii Manovskii & Gueorgui Kambourov, 2004. "Occupational Specificity of Human Capital," 2004 Meeting Papers 197, Society for Economic Dynamics.
  9. Dustmann, Christian & Schönberg, Uta, 2004. "Training and Union Wages," IZA Discussion Papers 1435, Institute for the Study of Labor (IZA).
  10. Christian Pfeifer & Stefan Schneck, 2010. "Relative Wage Positions and Quit Behavior: New Evidence from Linked Employer-Employee Data," Working Paper Series in Economics 163, University of Lüneburg, Institute of Economics.
  11. Jacobebbinghaus, Peter & Alda, Holger, 2007. "LIAB-Datenhandbuch, Version 2.0 (LIAB Data Handbook Version 2.0)," FDZ Datenreport. Documentation on Labour Market Data 200702_de, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  12. George A. Akerlof, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, Oxford University Press, vol. 97(4), pages 543-569.
  13. Kriechel, Ben & Mühlemann, Samuel & Pfeifer, Harald & Schuette, Miriam, 2012. "Works Councils, Collective Bargaining and Apprenticeship Training," IZA Discussion Papers 6497, Institute for the Study of Labor (IZA).
  14. David Soskice, 1994. "Reconciling Markets and Institutions: The German Apprenticeship System," NBER Chapters, in: Training and the Private Sector: International Comparisons, pages 25-60 National Bureau of Economic Research, Inc.
  15. Acemoglu, Daron & Pischke, Jorn-Steffen, 2000. "Certification of training and training outcomes," European Economic Review, Elsevier, vol. 44(4-6), pages 917-927, May.
  16. Harhoff, Dietmar & Kane, Thomas J., 1995. "Is the German apprenticeship system a panacea for the US labour market?," ZEW Discussion Papers 95-19, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  17. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, Oxford University Press, vol. 84(3), pages 488-500.
  18. McLaughlin, Kenneth J, 1991. "A Theory of Quits and Layoffs with Efficient Turnover," Journal of Political Economy, University of Chicago Press, vol. 99(1), pages 1-29, February.
  19. 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.
  20. Uta Schönberg, 2007. "Testing for Asymmetric Employer Learning," Journal of Labor Economics, University of Chicago Press, vol. 25, pages 651-691.
  21. Mohrenweiser, Jens & Zwick, Thomas & Backes-Gellner, Uschi, 2013. "Poaching and firm-sponsored training: First clean evidence," ZEW Discussion Papers 13-037, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  22. Eugene A. Kroch & Kriss Sjoblom, 1994. "Schooling as Human Capital or a Signal: Some Evidence," Journal of Human Resources, University of Wisconsin Press, vol. 29(1), pages 156-180.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:iso:educat:0071. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Eggenberger)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.