Promotion, Turnover, and Discretionary Human Capital Acquisition.
This article explores human capital acquisition decisions when job placement helps determine competition for a worker. With asymmetric information, workers may invest in firm-specific capital without long-term contracts. Specific investment increases promotion chances (and hence wage competition), shifting competition back to a time when firms are symmetrically uninformed. If general human capital is the efficient (output-maximizing) investment, then an equivalent firm-specific investment maximizes expected career wages. This is a general result for sellers in second-price auctions: sellers (of labor) invest to maximize the expected second-highest bidder valuation (wage), not the winner's expected valuation. Copyright 1998 by University of Chicago Press.
Year of publication: |
1998
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Authors: | Scoones, David ; Bernhardt, Dan |
Published in: |
Journal of Labor Economics. - University of Chicago Press. - Vol. 16.1998, 1, p. 122-41
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Publisher: |
University of Chicago Press |
Saved in:
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