Standard economic theory predicts that firms will not invest in general training and will underinvest in specific … training. Empirical evidence, however, indicates that firms do invest in general training of their workers. Evidence from … laboratory experiments points to less underinvestment in specific training than theory predicts. We propose a simple model in …

capital by training-on-the-job and by learning-by-doing. The human capital of an employeeis subject to depreciation when …