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Career Progression and Comparative Advantage

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  • Shintaro Yamaguchi

Abstract

This paper constructs and structurally estimates a dynamic occupational choice model that has two distinct features. First, an occupation is vertically and horizontally differentiated by a multidimensional task complexity measure. This allows a simultaneous analysis of career progression and comparative advantage. Second, the model includes hundreds of occupations by characterizing all jobs by a multidimensional task complexity vector, thereby avoiding the curse of dimensionality. Estimation results from the Dictionary of Occupational Titles (DOT) and the National Longitudinal Survey of Youth 1979 (NLSY) indicate that wages increase according to task complexity and that individuals climb up the career ladder along the dimension of tasks in which they have a comparative advantage.

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File URL: http://socserv.mcmaster.ca/econ/rsrch/papers/archive/2008-03.pdf
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Bibliographic Info

Paper provided by McMaster University in its series Department of Economics Working Papers with number 2008-03.

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Length: 35 pages
Date of creation: Feb 2008
Date of revision:
Handle: RePEc:mcm:deptwp:2008-03

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Keywords: Career decisions; dynamic stochastic discrete choice model;

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References

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  1. Kathryn L. Shaw, 1984. "A Formulation of the Earnings Function Using the Concept of Occupational Investment," Journal of Human Resources, University of Wisconsin Press, vol. 19(3), pages 319-340.
  2. Keane, Michael P & Wolpin, Kenneth I, 1997. "The Career Decisions of Young Men," Journal of Political Economy, University of Chicago Press, vol. 105(3), pages 473-522, June.
  3. Oded Galor & Nachum Sicherman, 1988. "A Theory of Career Mobility," University of Chicago - George G. Stigler Center for Study of Economy and State 51, Chicago - Center for Study of Economy and State.
  4. Donghoon Lee & Kenneth I. Wolpin, 2004. "Intersectoral Labor Mobility and the Growth of the Service Sector," PIER Working Paper Archive 04-036, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
  5. Neal, Derek, 1999. "The Complexity of Job Mobility among Young Men," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 237-61, April.
  6. Iourii Manovskii & Gueorgui Kambourov, 2004. "Occupational Specificity of Human Capital," 2004 Meeting Papers 197, Society for Economic Dynamics.
  7. Ronni Pavan, 2006. "Career Choice and Wage Growth," 2006 Meeting Papers 504, Society for Economic Dynamics.
  8. Miller, Robert A, 1984. "Job Matching and Occupational Choice," Journal of Political Economy, University of Chicago Press, vol. 92(6), pages 1086-120, December.
  9. Ingram, Beth F. & Neumann, George R., 2006. "The returns to skill," Labour Economics, Elsevier, vol. 13(1), pages 35-59, February.
  10. Boyan Jovanovic & Yaw Nyarko, 1996. "Stepping Stone Mobility," NBER Working Papers 5651, National Bureau of Economic Research, Inc.
  11. Rust, John, 1987. "Optimal Replacement of GMC Bus Engines: An Empirical Model of Harold Zurcher," Econometrica, Econometric Society, vol. 55(5), pages 999-1033, September.
  12. Shintaro Yamaguchi, 2007. "The Effect of Match Quality and Specific Experience on Career Decisions and Wage Growth," Department of Economics Working Papers 2007-01, McMaster University.
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Citations

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Cited by:
  1. Okumura, Tsunao & Usui, Emiko, 2010. "Do Parents' Social Skills Influence Their Children's Sociability?," PIE/CIS Discussion Paper 466, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
  2. Yamaguchi, Shintaro, 2010. "The effect of match quality and specific experience on career decisions and wage growth," Labour Economics, Elsevier, vol. 17(2), pages 407-423, April.
  3. Chris Robinson, 2011. "Occupational Mobility, Occupation Distance and Specific Human Capital," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers 20115, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
  4. Shintaro Yamaguchi, 2012. "Tasks and Heterogeneous Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 30(1), pages 1 - 53.

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