The Low-Skill, Bad-Job Trap

Dennis Snower

No 999, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: The paper explains how a country can fall into a 'low-skill, bad-job trap', in which workers acquire insufficient training and firms provide insufficient skilled vacancies. In particular, the paper argues that in countries where a large proportion of the workforce is unskilled, firms have little incentive to provide good jobs (requiring high skills and providing high wages), and if few good jobs are available, workers have little incentive to acquire skills. In this context, the paper examines the need for and effectiveness of training policy, and provides a possible explanation for why Western countries have responded so differently to the broad-based shift in labour demand from unskilled to skilled labour.

Keywords: Employment; Productivity; Search; Skills; Training; Vacancies (search for similar items in EconPapers)
JEL-codes: D21 D62 D82 D83 E24 J22 J23 J31 (search for similar items in EconPapers)
Date: 1994-09
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Citations: View citations in EconPapers (33)

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