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Information Advantages of Training Employers Despite Credible Training Certificates

Author

Listed:
  • Jens Mohrenweiser

    (Bournemouth University)

  • Gabriele Wydra-Somaggio

    (Institut fuer Arbeitsmarkt- und Berufsforschung (IAB))

  • Thomas Zwick

    (University of Wuerzburg and ZEW Mannheim)

Abstract

We show that employers that invest in general human capital can positively select the employees they retain although training contents are transferable and visible to all employers (they are certified by credible external institutions). To solve the puzzle, we distinguish between soft and hard skills. Hard skills are tested in graded final exams and can be signalled to outside employers while soft skills are typically not tested and cannot be signalled. Therefore, the information advantage about soft skills can explain why employers keep a positive selection of training participants and invest in certified and transferable skills.

Suggested Citation

  • Jens Mohrenweiser & Gabriele Wydra-Somaggio & Thomas Zwick, 2017. "Information Advantages of Training Employers Despite Credible Training Certificates," Economics of Education Working Paper Series 0121, University of Zurich, Department of Business Administration (IBW), revised Apr 2017.
  • Handle: RePEc:iso:educat:0121
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    References listed on IDEAS

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    Cited by:

    1. Giorgio d'Agostino & Michele Raitano & Margherita Scarlato, 2022. "Job mobility and heterogeneous returns to apprenticeship training in Italy," British Journal of Industrial Relations, London School of Economics, vol. 60(2), pages 391-423, June.
    2. Kuhn, Andreas & Schweri, Jürg & Wolter, Stefan C., 2022. "Local norms describing the role of the state and the private provision of training," European Journal of Political Economy, Elsevier, vol. 75(C).
    3. Aepli, Manuel & Kuhn, Andreas, 2021. "Open labor markets and Firms’ substitution between training apprentices and hiring workers," Labour Economics, Elsevier, vol. 70(C).
    4. Manuel Aepli & Andreas Kuhn, 2020. "Open Labor Markets and Firms' Substitution between Training Apprentices and Hiring Workers," Economics of Education Working Paper Series 0179, University of Zurich, Department of Business Administration (IBW).
    5. Jens Mohrenweiser & Thomas Zwick & Uschi Backes‐Gellner, 2019. "Poaching and Firm‐Sponsored Training," British Journal of Industrial Relations, London School of Economics, vol. 57(1), pages 143-181, March.
    6. Aepli, Manuel & Kuhn, Andreas, 2019. "Open Labor Markets and Firms’ Substitution between Training Apprentices and Hiring Workers," IZA Discussion Papers 12479, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    training; employer change; adverse selection; asymmetric information;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training

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