Arbeitspapier
Training, Job Security and Incentive Wages
This paper considers the optimal level of firm-specific training by taking into account the positive effect of training on the expected duration of workers' current employment. In the framework of an efficiency wage model, a short expected job tenure represents a disamenity that reduces the penalty from shirking. As this disamenity increases, workers have an incentive to continue providing a positive level of effort only if they are compensated by a higher wage. We endogenize the employment separation rate by introducing firm-specific training. Firm-specific training creates a rent that is lost if the worker is separated from the firm. As a result, the firm will be more reluctant to fire its trained workforce in a recession. This implies that firm-specific training can decrease current wages as it implies a credible commitment to lower future labour turnover.
- Sprache
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Englisch
- Erschienen in
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Series: CESifo Working Paper ; No. 955
- Klassifikation
-
Wirtschaft
- Thema
-
efficiency wages
firm-specific training
- Ereignis
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Geistige Schöpfung
- (wer)
-
Katsimi, Margarita
- Ereignis
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Veröffentlichung
- (wer)
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Center for Economic Studies and ifo Institute (CESifo)
- (wo)
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Munich
- (wann)
-
2003
- Handle
- Letzte Aktualisierung
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10.03.2025, 11:44 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Katsimi, Margarita
- Center for Economic Studies and ifo Institute (CESifo)
Entstanden
- 2003