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This chapter introduces a model of efficiency-wage competition along the lines put forward by Hahn (1987). Specifically, I analyze a two-firm economy in which employers screen their workforce by means of increasing wage offers competing one another for high-quality employees. The main results are the following. First, using a specification of effort such that the problem of firms is well-behaved, optimal wage offers are strategic complements. Second, the symmetric Nash equilibrium can be locally stable under the assumption that firms adjust their wage offers in the direction of increasing profits by conjecturing that any wage offer above (below) equilibrium will lead competitors to underbid (overbid) such an offer. Finally, the exploration of possible labor market equilibria reveals that effort is counter-cyclical.

The purpose of this paper is to take into consideration the propensity to offer vocational training of a large sample of Italian private firms by retrieving cross-sectional data from INDACO (2009).

Estimating a probit model, the author assesses how the age and the gender composition of the employed workforce, as well as a set of relevant corporate characteristics, such as size, sector, geographical location, innovation strategies, R&D investments and use of social safety valves, are linked to the willingness of firms to supply on-the-job training.

First, as far as the average age of the whole employed workforce is concerned, it was found that the propensity of surveyed firms toward training provision follows an inverted U-shaped pattern. Furthermore, it was shown that larger firms have a higher training propensity with respect to small firms, and the same attitude holds for productive units that adopted innovation strategies and/or invested in R&D projects. By contrast, it was found that the propensity to support training activities is negatively correlated to the percentage of employed women and the use social valves.

The sample of business units taken into consideration is quite large, but it has some biases toward larger and manufacturing firms. Moreover, the cross-sectional perspective of the analysis does not allow implementation of the finer identification procedures that can be applied with panel data. Furthermore, the lack of employer – employee linked data does not allow to fully address the issue of compliance to training activities.

From a policy point of view, the results shown throughout the paper suggest some broad guidelines. First, especially in small firms, vocational training for young and older workers should be somehow stimulated. Moreover, as far as mature employees are concerned, those interventions should be framed in an active ageing perspective. Subsidies and targeted job placement programmes are often claimed as being the most appropriate ways to improve the underprivileged position of older workers. However, continuous learning during the whole working life still appears as the most effective device to reduce the employment disadvantages in the older years.

While there are a number of papers that study the age patterns of training participation by using workers’ data retrieved from personnel and/or labour force surveys, this work is the first attempt to provide a probabilistic assessment of the decisions of Italian firms regarding training provision by taking into account the ageing perspectives of the incumbent workforce.