Advanced Search
MyIDEAS: Login

Experience Matters: Human Capital and Development Accounting

Contents:

Author Info

  • David Lagakos

    ()
    (Arizona State University)

  • Benjamin Moll

    ()
    (Princeton University)

  • Tommaso Porzio

    ()
    (Yale University)

  • Nancy Qian

    ()
    (Yale University, NBER, CEPR, BREAD)

Abstract

Using recently available large-sample micro data from 36 countries, we document that experience-earnings profiles are flatter in poor countries than in rich countries. Motivated by this fact, we conduct a development accounting exercise that allows the returns to experience to vary across countries but is otherwise standard. When the country-specific returns to experience are interpreted in such a development accounting framework - and are therefore accounted for as part of human capital - we find that human and physical capital differences can account for almost two thirds of the variation in cross-country income differences, as compared to less than half in previous studies.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://humcap.uchicago.edu/RePEc/hka/wpaper/Lagakos_Moll_Porzio_Qian_EM.pdf
File Function: First version, November 29, 2012
Download Restriction: no

File URL: http://www.princeton.edu/%7Emoll/EM.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Human Capital and Economic Opportunity Working Group in its series Working Papers with number 2012-021.

as in new window
Length:
Date of creation: Dec 2012
Date of revision:
Handle: RePEc:hka:wpaper:2012-021

Note: M
Contact details of provider:
Email:
Web page: http://www.hceconomics.org/
More information through EDIRC

Related research

Keywords: Human Capital; Experience-Earnings Profiles; Development Accounting;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Jesper Bagger & Francois Fontaine & Jean-Marc Robin, 2014. "Tenure, experience, human capital and wages: a tractable equilibrium search model of wage dynamics," CeMMAP working papers CWP12/14, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  2. Robert H. Topel & Michael P. Ward, 1988. "Job Mobility and the Careers of Young Men," NBER Working Papers 2649, National Bureau of Economic Research, Inc.
  3. Andres Erosa & Tatyana Koreshkova & Diego Restuccia, 2009. "How Important is Human Capital? A Quantitative Theory Assessment of World Income Inequality," Working Papers 09007, Concordia University, Department of Economics, revised Mar 2009.
  4. Fatih Guvenen, 2006. "Learning your earning: are labor income shocks really very persistent?," Discussion Paper / Institute for Empirical Macroeconomics 145, Federal Reserve Bank of Minneapolis.
  5. Douglas Gollin, 2002. "Getting Income Shares Right," Journal of Political Economy, University of Chicago Press, vol. 110(2), pages 458-474, April.
  6. Fatih Guvenen & Burhanettin Kuruscu & Serdar Ozkan, 2009. "Taxation of Human Capital and Wage Inequality: A Cross-Country Analysis," NBER Working Papers 15526, National Bureau of Economic Research, Inc.
  7. Gauri Kartini Shastry & David N. Weil, 2003. "How Much of Cross-Country Income Variation is Explained By Health?," Journal of the European Economic Association, MIT Press, vol. 1(2-3), pages 387-396, 04/05.
  8. Todd Schoellman, 2012. "Education Quality and Development Accounting," Review of Economic Studies, Oxford University Press, vol. 79(1), pages 388-417.
  9. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352.
  10. Todd Schoellman & Berthold Herrendorf, 2012. "Why is Measured Productivity so Low in Agriculture?," 2012 Meeting Papers 75, Society for Economic Dynamics.
  11. Jesper Bagger & Fran?ois Fontaine & Fabien Postel-Vinay & Jean-Marc Robin, 2014. "Tenure, Experience, Human Capital, and Wages: A Tractable Equilibrium Search Model of Wage Dynamics," American Economic Review, American Economic Association, vol. 104(6), pages 1551-96, June.
  12. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-90, October.
  13. Nicholas Bloom & Aprajit Mahajan & David McKenzie & John Roberts, 2010. "Why Do Firms in Developing Countries Have Low Productivity?," American Economic Review, American Economic Association, vol. 100(2), pages 619-23, May.
  14. Lazear, Edward P, 1979. "Why Is There Mandatory Retirement?," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1261-84, December.
  15. Mark Aguiar & Erik Hurst, 2013. "Deconstructing Life Cycle Expenditure," Journal of Political Economy, University of Chicago Press, vol. 121(3), pages 437 - 492.
  16. Nicola Gennaioli & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2013. "Human Capital and Regional Development," The Quarterly Journal of Economics, Oxford University Press, vol. 128(1), pages 105-164.
  17. Azariadis, Costas, 1988. " Human Capital and Self-Enforcing Contracts," Scandinavian Journal of Economics, Wiley Blackwell, vol. 90(4), pages 507-28.
  18. Jesse Perla & Christopher Tonetti, 2012. "Endogenous Risk and Growth," 2012 Meeting Papers 479, Society for Economic Dynamics.
Full references (including those not matched with items on IDEAS)

Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Is better rewarding experience the solution to Third World development?
    by Economic Logician in Economic Logic on 2013-05-03 14:23:00
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Theodore Koutmeridis, 2013. "The Market for "Rough Diamonds": Information, Finance and Wage Inequality," CDMA Working Paper Series 201307, Centre for Dynamic Macroeconomic Analysis, revised 14 Oct 2013.
  2. Wenbiao Cai & Manish Pandey, 2013. "The Agricultural Productivity Gap in Europe," Departmental Working Papers 2013-05, The University of Winnipeg, Department of Economics.
  3. Edgar Vogel & Alexander Ludwig & Axel Börsch-Supan, 2013. "Aging and Pension Reform: Extending the Retirement Age and Human Capital Formation," Working Paper Series in Economics 59, University of Cologne, Department of Economics.
  4. Douglas Gollin & David Lagakos & Michael E. Waugh, 2011. "The Agricultural Productivity Gap in Developing Countries," Working Papers 11-14, New York University, Leonard N. Stern School of Business, Department of Economics.
  5. Caselli, Francesco & Ciccone, Antonio, 2013. "The contribution of schooling in development accounting: Results from a nonparametric upper bound," Journal of Development Economics, Elsevier, vol. 104(C), pages 199-211.
  6. Douglas Gollin & David Lagakos & Michael E. Waugh, 2013. "The Agricultural Productivity Gap," NBER Working Papers 19628, National Bureau of Economic Research, Inc.
  7. Kaarsen, Nicolai, 2014. "Cross-country differences in the quality of schooling," Journal of Development Economics, Elsevier, vol. 107(C), pages 215-224.
  8. Todd Schoellman, 2013. "Refugees and Early Childhood Human Capital," 2013 Meeting Papers 52, Society for Economic Dynamics.
  9. Theodore Koutmeridis, 2013. "The Market for "Rough Diamonds": Information, Finance and Wage Inequality," Discussion Paper Series, Department of Economics 201307, Department of Economics, University of St. Andrews, revised 14 Oct 2013.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:hka:wpaper:2012-021. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jennifer Pachon).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.