DP4241 On-the-Job Training, Firing Costs and Employment

Author(s): Pilar Diaz-Vazquez, Dennis J. Snower
Publication Date: February 2004
Keyword(s): average employment, firing costs, on-the-job training
JEL(s): E24, J23, J24, J32, J64
Programme Areas: Labour Economics
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=4241

This Paper explores the influence of on-the-job training on the employment effect of firing costs. It shows that on-the-job training (generating firm specific skills) causes firing costs to have a contractionary influence on average employment (over the booms and recessions of the business cycle).