TY  - RPRT
        AU  - Feng, Shuaizhang
AU  - Zheng, Bingyong
        TI  - Imperfect Information, On-the-Job Training, and the Employer Size-Wage Puzzle: Theory and Evidence
        PY  - 2010/Jun/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 4998
        UR  - https://www.iza.org/index.php/publications/dp4998
        AB  - This paper develops a two-period labor market model with imperfect information and on-the-job training, and uses data from National Longitudinal Survey of Youth 1979 Cohorts (NLSY79) to test its predictions. We find that training does not explain the positive relationship between employer size and wage. In addition, for industries that display size-wage premium, workers in large establishments are more likely to receive on-the-job training but their return to training is smaller. Our theory, substantiated by the new empirical evidence, suggests that it is not large firms, per se, but firms that hire better workers who are paying a wage premium.
        KW  - imperfect information
KW  - sorting
KW  - on-the-job training
KW  - size-wage premium
        ER  -