Training , employer learning , employer change , adverse selection , asymmetric information
Abstract:
This paper addresses the puzzle how employers that invest in general human capital can gain
an information advantage with respect to the ability of their employees when training is
certified by credible external institutions. We apply an established model from the
employer-learning literature and distinguish between two ability dimensions: cognitive and
work-related ability. We apply this model to the German apprenticeship system and show
that cognitive ability certified by external institutions at that the end of apprenticeship
training can be signalled to outside employers. Apprenticeship graduates however cannot
signal their work-related ability – measured by a small voluntary bonus paid by the training
employer – to the outside market. We therefore show that the information advantage on
work-related ability explains that training employers can positively select the apprentices
they retain. As a consequence, this information advantage induces employers to invest in
certified and transferable human capital.
Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.
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