An Explanation of International Differences in Education and Workplace Training

Giorgio Brunello and Alfredo Medio
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Alfredo Medio: Università Ca’ Foscari di Venezia

No 114, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We develop a simple search equilibrium model of workplace training and education based on two features. First, investment in education improves job-related learning skills and reduces training costs burdened by firms. Second, firms with vacant skilled job slots can choose between recruitment from the market and training. Compared to Germany and Japan, the US has both a higher inflow rate into unemployment and a higher efficiency of the matching process. While the combined effort of these differences on the share of educated labor is ambiguous, the effect on the percentage of firms undertaking workplace training is to unambiguously reduce it.

Keywords: workplace training; Education (search for similar items in EconPapers)
JEL-codes: J24 J31 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2000-02
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Published - published in: European Economic Review, 2001, 45 (2), 307-322

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