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Firm-Specific Training

Author

Listed:
  • Christopher Harris
  • Leonardo Felli

Abstract

This paper introduces two complementary models of firm-specific training: an informational model and a productivity-enhancement model. In both models, market provision of firm-specific training is inefficient. However, the nature of the inefficiency depends on the balance between the two key components of training, namely productivity enhancement and employee evaluation. In the informational model, training results in a proportionate increase in productivity enhancement and employee valuation, and training is underprovided by the market. In the productivity-enhancement model, training results in an increase in productivity enhancement but no change in employee evaluation, and training is overprovided by the market. In both models, turnover is inefficiently low

Suggested Citation

  • Christopher Harris & Leonardo Felli, 2004. "Firm-Specific Training," 2004 Meeting Papers 62, Society for Economic Dynamics.
    • Handle: RePEc:red:sed004:62
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    References listed on IDEAS

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    1. Christopher A. Pissarides, 1994. "Search Unemployment with On-the-job Search," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 61(3), pages 457-475.
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    Cited by:

    1. Gueorgui Kambourov & Iourii Manovskii, 2001. "Rising Occupational and Industry Mobility in the United States:1968-1993," PIER Working Paper Archive 04-012, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 05 Jul 2004.
    2. Garloff Alfred & Kuckulenz Anja, 2006. "Training, Mobility, and Wages: Specific Versus General Human Capital," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 226(1), pages 55-81, February.
    3. Th'eo Durandard, 2023. "Dynamic delegation in promotion contests," Papers 2308.05668, arXiv.org.

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    More about this item

    Keywords

    Learning; Firm-Specific Human Capital; Training;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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