Business Cycle Fluctuations and the Life Cycle: How Important is On-The-Job Skill Accumulation?

Gary D. Hansen and Selahattin Imrohoroglu

No 13603, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study the effects of on-the-job skill accumulation on average hours worked by age and the volatility of hours over the life cycle in a calibrated general equilibrium model. Two forms of skill accumulation are considered: learning by doing and on-the-job training. In our economy with learning by doing, individuals supply more labor early in the life cycle and less as they approach retirement than they do in an economy without this feature. The impact of this feature on the volatility of hours over the life cycle depends on the value of the intertemporal elasticity of labor supply. When individuals accumulate skills by on-the-job training, there are only weak effects on both the steady-state labor supply and its volatility over the life cycle.

JEL-codes: E32 J22 J24 (search for similar items in EconPapers)
Date: 2007-11
New Economics Papers: this item is included in nep-bec, nep-dge, nep-hrm, nep-lab and nep-mac
Note: EFG
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Published as Hansen, Gary D. & Imrohoroglu, Selahattin, 2009. "Business cycle fluctuations and the life cycle: How important is on-the-job skill accumulation?," Journal of Economic Theory, Elsevier, vol. 144(6), pages 2293-2309, November.

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Journal Article: Business cycle fluctuations and the life cycle: How important is on-the-job skill accumulation? (2009)
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