Does Poaching Distort Training?

38 Pages Posted: 7 Mar 2003

See all articles by Espen R. Moen

Espen R. Moen

Norwegian Business School; Centre for Economic Policy Research (CEPR)

Asa Rosen

Stockholm University - Swedish Institute for Social Research (SOFI); University of Oslo

Multiple version iconThere are 2 versions of this paper

Date Written: June 2002

Abstract

We analyse the efficiency of the labour market outcome in a competitive search equilibrium model with endogenous turnover and endogenous general human capital formation. We show that search frictions do not distort training decisions if firms and their employees are able to coordinate efficiently, for instance, by using long-term contracts. In the absence of efficient coordination devices there is too much turnover and too little investments in general training. Nonetheless, the number of training firms and the amount of training provided are constrained optimal, and training subsidies therefore reduce welfare.

Keywords: Matching, Training, Poaching, Efficiency

JEL Classification: J24, J41, J63, J64

Suggested Citation

Moen, Espen R. and Rosen, Asa and Rosen, Asa, Does Poaching Distort Training? (June 2002). Available at SSRN: https://ssrn.com/abstract=330120 or http://dx.doi.org/10.2139/ssrn.330120

Espen R. Moen

Norwegian Business School ( email )

N-0442 Oslo
Norway
+47 46410786 (Phone)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Asa Rosen (Contact Author)

Stockholm University - Swedish Institute for Social Research (SOFI) ( email )

SE-106 91 Stockholm
Sweden
+46 8 163 641 (Phone)
+46 8 754 670 (Fax)

University of Oslo ( email )

PO Box 6706 St Olavs plass
Oslo, N-0317
Norway