Firm-Specific Training

Leonardo Felli () and Christopher Harris ()
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Christopher Harris: Department of Economics, Cambridge University

No 38, Economics Working Papers from Institute for Advanced Study, School of Social Science

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 evaluation, 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.

Keywords: firm-specific training; productivity-enhancement; employee evaluation; components of training (search for similar items in EconPapers)
Date: Written
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Related works:
Working Paper: Firm-Specific Training (2004)
Working Paper: Firm-Specific Training (2005)
Working Paper: Firm-Specific Training (2004)
Working Paper: Firm-Specific Training (2004)
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