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| Atsuko Tanaka and Hsuan-chih Lin |
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| ''Employee Investment and Screening based on Labor Force Attachment'' |
| ( 2020, Vol. 40 No.2 ) |
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| This paper studies firms' employee investment decisions based on labor force attachment under a screening model. We first characterize the conditions for pooling/separating equilibria and analyze the associated inefficiency. We find that strengthening the worker's labor force attachment does not always improve social welfare because it may lead to over-investment. The implications help us better understand the contributing factors to the gender wage gap since average job turnover rate is higher among women than men.
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| Keywords: Labor Force Attachment, Screening Mechanism, Wage Contracts, Employee Training |
JEL: J3 - Wages, Compensation, and Labor Costs: General
J7 - Labor Discrimination: General |
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| Manuscript Received : Jul 19 2019 | | Manuscript Accepted : May 15 2020 |
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