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How Much Does Talent Matter? Evidence from the Brazilian Formal Cultural Industry

Ricardo Freguglia and Amir Borges Ferreira Neto
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Ricardo Freguglia: Federal University of Juiz de Fora, Department of Economics

No 17-07, Working Papers from Department of Economics, West Virginia University

Abstract: The goal of this paper is to evaluate how much does talent – the individual non-observed characteristics – matter to explain the wage differences between workers from the cultural industry and workers from other formal industries in Brazil. To do so we use the data from 2003 to 2008 of the Rais-Migra – MTE, which is a true panel of formal workers from Brazil, and use fixed effects estimators to capture the talent measure and the Blinder (1973) and Oaxaca (1973) decomposition to seek for evidences of wage difference. The results imply that the talent is important in the determination of wages especially when considering formal workers in the cultural activities, occupations and workers in both cultural activities and occupation. The Oaxaca decomposition provides evidence that when considering talent, each of the groups paid their workers more per se, proving that not only the talent matter, but also that the formal cultural environment in Brazil positively discriminates their workers.

Keywords: Wage Differentials; Cultural Industry; Talent; Fixed Effects; Brazil (search for similar items in EconPapers)
JEL-codes: J31 Z11 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2017-04
New Economics Papers: this item is included in nep-cul and nep-lam
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