The Structure of Wages and Investment in General Training

Daron Acemoglu and Jorn-Steffen Pischke

Working papers from Massachusetts Institute of Technology (MIT), Department of Economics

Abstract: In the standard model of human capital with perfect labor markets, workers pay for general training. When labor market feictions compress the structure of wages, firms may invest in the general skills of their employees. The reason is that the d istortion in the wage structure turns "technologically"general skills into "specific" skills. Labor market frictions and institutions, such as minimum wages and union wage setting, are crucial in shaping the wage structure, and thus have an important impa ct on training. Our results suggest that the more frictional and regulated labor markets in Europe and Japan may generate more firm-sponsored general training than the U.S.

Keywords: LABOUR MARKET; TRAINING (search for similar items in EconPapers)
JEL-codes: J24 J31 J41 (search for similar items in EconPapers)
Pages: 25 pages
Date: 1997
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: The Structure of Wages and Investment in General Training (1999)
Working Paper: The Structure of Wages and Investment in General Training (1998)
Working Paper: The Structure of Wages and Investment in General Training (1998)
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