The Structure of Wages and Investment in General Training

Acemoglu, Daron; Pischke, Jörn-Steffen

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The Structure of Wages and Investment in General Training

NBER Working Paper No. w6357

28 Pages Posted: 11 Jun 2000 Last revised: 16 Nov 2022

See all articles by Daron Acemoglu

Daron Acemoglu

Massachusetts Institute of Technology (MIT) - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Jörn-Steffen Pischke

London School of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

There are 3 versions of this paper

Date Written: January 1998

Abstract

In the standard model of human capital with perfect labor markets general training. When labor market frictions compress the structure of wages in the general skills of their employees. The reason is that the distortion in the wage structure" turn 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 thus have an important impact 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.

Suggested Citation: Suggested Citation

Acemoglu, Daron and Pischke, Jörn-Steffen (Steve), The Structure of Wages and Investment in General Training (January 1998). NBER Working Paper No. w6357, Available at SSRN: https://ssrn.com/abstract=226107