Occupational Choice and Incentives: The Role of Family Background
AbstractA model of occupational choice and human capital investment is developed and tested. The model allows family background to influence occupational choice via access to economic resources, differences in costs of schooling, and ability uncertainty. The model predicts that people are more sensitive to economic incentives when considering occupations that are different from the parental occupation. It also predicts that the occupational choice of individuals from poor background is more sensitive to economic incentives than the occupational choice of well off individuals. These implications are confirmed on Swedish data using a mixed multinomial logit framework, explicitly accounting for unobserved heterogeneity.
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Bibliographic InfoPaper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 539.
Length: 27 pages
Date of creation: 27 Sep 2000
Date of revision:
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Economic incentives; Family background; Intergenerational mobility; Mixed multinomial logit; Occupational choice;
Find related papers by JEL classification:
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J62 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Job, Occupational and Intergenerational Mobility; Promotion
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