Human-capital investment and the wage gap
AbstractAccording to empirical studies, the wage differential by skills evolved non-monotonically in the past decades although the relative supply of skilled labor steadily increased. The present paper provides a theoretical explanation for this finding. In our setting, technological change intertemporally alters the human-capital investment incentives of heterogeneous individuals. As a consequence of changing incentives, the time path of the relative wage is U-shaped while there is a rise in the share of skilled workers.
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Bibliographic InfoArticle provided by Springer in its journal Economic Theory.
Volume (Year): 19 (2002)
Issue (Month): 4 ()
Note: Received: November 28, 2000; revised version: January 30, 2001
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Web page: http://link.springer.de/link/service/journals/00199/index.htm
Other versions of this item:
- I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
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