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Sex Differences in Tenure Profiles: Effects of Shared Firm-Specific Investment

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  • Becker, Elizabeth
  • Lindsay, Cotton M
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    Abstract

    This article employs a model of Masanori Hashimoto with extensions by Donald Parsons to analyze variation in tenure by sex, age, and firm type. Fixed-wage contracts eliminate postcontractual opportunism associated with firm-specific human capital investment. However, such contracts result in inefficient quits and terminations. Calibration of the sharing of this investment between workers and employers minimizes the costs of these inefficient separations. Moreover, this optimal sharing rate varies systematically with the characteristics listed above. These tenure-slope implications are tested with favorable results. Copyright 1994 by University of Chicago Press.

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    Bibliographic Info

    Article provided by University of Chicago Press in its journal Journal of Labor Economics.

    Volume (Year): 12 (1994)
    Issue (Month): 1 (January)
    Pages: 98-118

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    Handle: RePEc:ucp:jlabec:v:12:y:1994:i:1:p:98-118

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    Web page: http://www.journals.uchicago.edu/JOLE/

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    Cited by:
    1. Frank Walsh & Eric Strobl, 1999. "Changes in the Gender Wage Gap and The Returns to Firm Specific Human Capital," Working Papers 199907, School Of Economics, University College Dublin.
    2. Munasinghe, Lalith & Reif, Tania & Henriques, Alice, 2008. "Gender gap in wage returns to job tenure and experience," Labour Economics, Elsevier, vol. 15(6), pages 1296-1316, December.
    3. Hessel Oosterbeek & Edwin Leuven, 2001. "Firm-Specific Human Capital as a Shared Investment: Comment," American Economic Review, American Economic Association, vol. 91(1), pages 342-347, March.
    4. Parrado, Eric & Caner, Asena & Wolff, Edward N., 2007. "Occupational and industrial mobility in the United States," Labour Economics, Elsevier, vol. 14(3), pages 435-455, June.
    5. Heywood, John S. & Wei, Xiangdong, 1997. "Piece-Rate Payment Schemes and the Employment of Women: The Case of Hong Kong," Journal of Comparative Economics, Elsevier, vol. 25(2), pages 237-255, October.

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