Training and Job-to-Job Mobility with Transfer Fees,

This study examines the potential impact of introducing a transfer system, similar to that used in professional soccer, into the standard labor market. We develop a toy model highlighting the theoretical properties of transfer fees. We show that, unlike non-compete clauses—which generate a trade-off between training and mobility—transfer fees encourage investment in training while preserving efficient mobility toward more productive firms. As a result, such a system brings the economy closer to the social optimum than laissez-faire. We then construct a life-cycle model featuring endogenous job creation and destruction, on-the-job search, and training. Using data from the French Labor Force Survey, we estimate the model’s parameters and conduct counterfactual experiments. Our simulations suggest that a time-limited compensation mechanism would significantly increase employment, training access, and welfare.