Firm-sponsored training and poaching externalities in regional labor markets

Regional Science and Urban Economics (Impact Factor: 1.01). 11/2011; 41(6):560-570. DOI: 10.1016/j.regsciurbeco.2011.04.003


A firm's decision to invest in the general human capital of its workers can be affected by labor market conditions. Firms located close to a large number of competitors might refrain from financing general training because skilled workers may be poached after completion of training. To better incorporate economic realities, we apply a novel definition of regional labor markets based on travel time rather than travel distance or political borders. Our results show that firms provide less training in dense regional labor markets, indicating that (potential) labor poaching affects the training behavior of firms. Moreover, the threat of poaching is relevant only if general training is financed by the employer.

Download full-text


Available from: Samuel Muehlemann, Oct 05, 2015
67 Reads
  • Source
    • "In today ' s global economy, many knowledge-intensive fi rms in industries such as accounting, law, and computer software have seen their growth hampered by a shortage of top global talent ( McCannon, 2008 ; Muehlemann and Wolter, 2011 ; Th e Economist , 2013 ). In this regard, identifying and enticing target employees have become essential in out-competing and out-innovating rivals. "
    [Show abstract] [Hide abstract]
    ABSTRACT: The utilization of market intermediaries to identify and recruit top talent is essential in winning the global talent race.
    Strategic Change 05/2014; 23(3-4). DOI:10.1002/jsc.1973
  • [Show abstract] [Hide abstract]
    ABSTRACT: Economic literature has widely acknowledged the growing role of firm training in the knowledge economy. Training fosters labour productivity, boosts competitiveness, and strengthens firms’ capacity to innovate. This key role of training, however, raises relevant issues in terms of the optimal level of the corresponding investment. In fact firms that bear training costs may not be able to fully appropriate the relevant benefits. In addition training may facilitate structural changes and stimulate growth nationwide. Efficiency reasons thus justify the existence of legal and/or institutional tools, either voluntary or mandatory, aimed at addressing suboptimal investments in human capital development. The purpose of this study is to draw a systematic taxonomy of the main legal and institutional devices able to address the underlying inefficiencies of training investments. Training is on the top of the political agenda in many countries. The European Union is committed to increase adults’ participation in lifelong learning and to improve the quality of training programs and institutions. However, while training is of increasing political interest, a proper tool-box for policy makers is still missing.
    European Journal of Law and Economics 01/2013; DOI:10.1007/s10657-013-9384-1 · 0.42 Impact Factor
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: The German system of post-school education and training is well-known for its high degree of standardization and stratification. Whereas transitions from this system to the labor market have been examined widely, much less is known about the transition patterns of school-leavers to post-school education. In particular, there is a shortage of research applying a comprehensive view of school-leavers from different tracks and investigating changing overall transition patterns over time. In our paper we fill this research gap by investigating school-leavers’ transitions to post-school education in West Germany over the last 30 years. Particular attention is given to the influence of contextual conditions, such as demographic fluctuations, economic cycles, and changes in the social composition of school-leavers. The empirical analyses are based on the retrospective life-course survey ALWA, which contains detailed information on the education and work trajectories of 10,000 adults in Germany. Our results show that school-leavers with low and medium attainment need more time to enter training when unemployment is high or when the school-leaver cohort is large. Overall, access to post-school education has become increasingly difficult for these groups, over and above the market shortages and the changes in group composition. By contrast, the transitions of school-leavers from higher secondary schools are unaffected by market fluctuations and long-term structural change. In the period looked at here, their chances remained almost stable. Accordingly, we conclude that the transition rates of school-leavers with different educational attainment have diverged in (West) Germany over the last 30 years.
    Research in Social Stratification and Mobility 06/2013; 32:65-83. DOI:10.1016/j.rssm.2013.01.004 · 1.12 Impact Factor
Show more