Tenure, experience, human capital and wages: a tractable equilibrium search model of wage dynamics

Jesper Bagger, Francois Fontaine and Jean-Marc Robin
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Jesper Bagger: Institute for Fiscal Studies

No CWP12/14, CeMMAP working papers from Centre for Microdata Methods and Practice, Institute for Fiscal Studies

Abstract: We develop and estimate an equilibrium job search model of worker careers, allowing for human capital accumulation, employer heterogeneity and individual-level shocks. Career wage growth is decomposed into the contributions of human capital and job search, within and between jobs. Human capital accumulation is largest for highly educated workers, and both human capital accumulation and job search contribute to the observed concavity of wage-experience pro files. The contribution from job search to wage growth, both within- and between-job, declines over the fi rst ten years of a career- the `job-shopping' phase of a working life - after which workers settle into high-quality jobs and use outside off ers to generate gradual wage increases, thus reaping the benefi ts from competition between employers.

Date: 2014-03-14
New Economics Papers: this item is included in nep-dge and nep-hrm
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Related works:
Journal Article: Tenure, Experience, Human Capital, and Wages: A Tractable Equilibrium Search Model of Wage Dynamics (2014)
Working Paper: Tenure, experience, human capital and wages: a tractable equilibrium search model of wage dynamics (2014)
Working Paper: Tenure, Experience, Human Capital and Wages: A Tractable Equilibrium Search Model of Wage Dynamics (2011)
Working Paper: Tenure, Experience, Human Capital and Wages: A Tractable Equilibrium Search Model of Wage Dynamics (2011)
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