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The timing of education

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  • Thomas Gall
  • Patrick Legros
  • Andrew Newman

Abstract

We study an assignment-with-investment model to highlight a tradeoff between investment in human capital before (ex ante system) and after (ex post system) matching on the labor market. The ex post system is better at coordinating investment within firms whereas the ex ante system is better at reducing mismatches. We further show that the ability to transfer surplus within firms affects mismatches and the relative performance of the two systems. At high degrees of transferability, they are equivalent. But when transferability is very low, the ex post system outperforms the ex ante system, although with moderate transferability the reverse is true. © 2006 by the European Economic Association.

Suggested Citation

  • Thomas Gall & Patrick Legros & Andrew Newman, 2006. "The timing of education," ULB Institutional Repository 2013/7026, ULB -- Universite Libre de Bruxelles.
  • Handle: RePEc:ulb:ulbeco:2013/7026
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    Citations

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    Cited by:

    1. repec:stn:sotoec:360186 is not listed on IDEAS
    2. George J. Mailath & Andrew Postlewaite & Larry Samuelson, 2017. "Premuneration Values and Investments in Matching Markets," Economic Journal, Royal Economic Society, vol. 127(604), pages 2041-2065, September.
    3. Andrea, Canidio, 2009. "The production of science," MPRA Paper 25218, University Library of Munich, Germany.
    4. repec:spr:jogath:v:46:y:2017:i:1:d:10.1007_s00182-015-0522-6 is not listed on IDEAS
    5. Ryan D. Edwards, 2010. "Health, Income, and the Timing of Education Among Military Retirees," NBER Working Papers 15778, National Bureau of Economic Research, Inc.
    6. Andrea, Canidio, 2010. "Absorptive capacity, the allocation of scientists, and firms' research productivity," MPRA Paper 30257, University Library of Munich, Germany.
    7. Thomas Gall & Patrick Legros & Andrew Newman, 2015. "College Diversity and Investment Incentives," Working Papers 2015-001, Human Capital and Economic Opportunity Working Group.
    8. Gall, Thomas & Hu, Xiaocheng & Vlassopoulos, Michael, 2016. "Dynamic Incentive Effects of Team Formation: Experimental Evidence," IZA Discussion Papers 10393, Institute for the Study of Labor (IZA).
    9. Thomas Gall & Patrick Legros & Andrew F. Newman, 2009. "Mis-match, Re-match, and Investment," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-189, Boston University - Department of Economics.

    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets

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