On-the-Job Training and the Effects of Insider Power

Pilar Diaz-Vazquez () and Dennis Snower
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Pilar Diaz-Vazquez: University of Santiago de Compostela, Spain

No 586, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Suppose insiders use their market power to push up their wages, while entrants receive their reservation wages. How will employment and productivity be affected? In addressing this question, we focus on the role of on-the-job training. We show that on-the-job training makes insider wage hikes less detrimental to average employment (over booms and recessions), and may even cause employment to be stimulated. Furthermore, such training can make insider wage hikes more detrimental to average productivity.

Keywords: insider power; employment; on-the-job training; productivity (search for similar items in EconPapers)
JEL-codes: E24 J23 J24 J31 J42 J64 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2002-09
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Citations: View citations in EconPapers (2)

Published - published in: Labour Economics, 2006, 13 (3), 317-341

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