General Training by Firms, Apprentice Contracts, and Public Policy.

Working paper

Workers will not pay for general on-the-job training if contracts are not enforceable. Firms may if there are mobility frictions. Private information about worker productivities, however, prevents workers who quit receiving their marginal products elsewhere. Their new employers then receive external benefits from their training. Training firms increase profits by offering apprenticeships committing them to high wages for trainees retained on completion. At those wages, only good workers are r...

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Authors: Malcomson, J; Maw, J; McCormick, B

• Publisher: Department of Economics (University of Southampton)
• Series: Working papers
• Publication date: 2000-01-01
• Language: English