Advanced Search
MyIDEAS: Login to save this paper or follow this series

Schooling, employer learning, and internal labor market effect: Wage dynamics and human capital investment in the Japanese steel industry, 1930-1960s

Contents:

Author Info

  • Nakabayashi, Masaki

Abstract

Schooling, an observable signal, decreases its impact on wages as employers “publicly” learn workers’ hidden types over workers’ experience in the market. This symmetric employer learning hypothesis has been empirically contested by, first, asymmetry of incumbent and entrant employers, and second, larger-than-imagined complementarity between schooling and work experience, which could enshroud learning effect. Microanalysis of Japanese steel industry shows, 1) experience before entering the long-term employment is complementary to schooling, 2) employer learning effect dominates the complementarity effect after workers’ joining the long-term employment. It suggests that reported evidences of employer learning have in fact captured internal labor market effect.

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://mpra.ub.uni-muenchen.de/30749/
File Function: original version
Download Restriction: no

File URL: http://mpra.ub.uni-muenchen.de/30920/
File Function: revised version
Download Restriction: no

File URL: http://mpra.ub.uni-muenchen.de/33162/
File Function: revised version
Download Restriction: no

File URL: http://mpra.ub.uni-muenchen.de/36842/
File Function: revised version
Download Restriction: no

Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 30749.

as in new window
Length:
Date of creation: 29 Apr 2011
Date of revision: 06 May 2011
Handle: RePEc:pra:mprapa:30749

Contact details of provider:
Postal: Schackstr. 4, D-80539 Munich, Germany
Phone: +49-(0)89-2180-2219
Fax: +49-(0)89-2180-3900
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC

Related research

Keywords: employer learning; schooling and wages; internal labor market effect;

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. Mincer, Jacob & Higuchi, Yoshio, 1988. "Wage structures and labor turnover in the United States and Japan," Journal of the Japanese and International Economies, Elsevier, vol. 2(2), pages 97-133, June.
  2. Baker, George & Gibbs, Michael & Holmstrom, Bengt, 1994. "The Wage Policy of a Firm," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 109(4), pages 921-55, November.
  3. Farber, Henry S & Gibbons, Robert, 1996. "Learning and Wage Dynamics," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 111(4), pages 1007-47, November.
  4. Bauer, Thomas & Dross, Patrick J & Haisken-DeNew, John P, 2002. "Sheepskin Effects in Japan," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3609, C.E.P.R. Discussion Papers.
  5. Clark, Melissa A. & Jaeger, David A., 2002. "Natives, the Foreign-Born and High School Equivalents: New Evidence on the Returns to the GED," IZA Discussion Papers 477, Institute for the Study of Labor (IZA).
  6. Goldin, Claudia, 1999. "Egalitarianism and the Returns to Education during the Great Transformation of American Education," Scholarly Articles 2623652, Harvard University Department of Economics.
  7. Jaeger, David A & Page, Marianne E, 1996. "Degrees Matter: New Evidence on Sheepskin Effects in the Returns to Education," The Review of Economics and Statistics, MIT Press, vol. 78(4), pages 733-40, November.
  8. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2006. "The Polarization of the U.S. Labor Market," American Economic Review, American Economic Association, American Economic Association, vol. 96(2), pages 189-194, May.
  9. Stephanie Lluis, . "The Role of Comparative Advantage and Learning in Wage Dynamics and Intra-Firm Mobility: Evidence from Germany," Working Papers, Human Resources and Labor Studies, University of Minnesota (Twin Cities Campus) 0103, Human Resources and Labor Studies, University of Minnesota (Twin Cities Campus).
  10. Shaw, Kathryn & Lazear, Edward P., 2008. "Tenure and output," Labour Economics, Elsevier, Elsevier, vol. 15(4), pages 704-723, August.
  11. Münich, Daniel & Svejnar, Jan & Terrell, Katherine, 2000. "Returns to Human Capital under the Communist Wage Grid and During the Transition to a Market Economy," IZA Discussion Papers 122, Institute for the Study of Labor (IZA).
  12. Paul Oyer, 2007. "Ability and Employer Learning: Evidence from the Economist Labor Market," NBER Working Papers 12989, National Bureau of Economic Research, Inc.
  13. Claudia Goldin, 2001. "The Human Capital Century and American Leadership: Virtues of the Past," NBER Working Papers 8239, National Bureau of Economic Research, Inc.
  14. Belman, Dale & Heywood, John S, 1991. "Sheepskin Effects in the Returns to Education: An Examination on Women and Minorities," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 720-24, November.
  15. Maxim Poletaev & Chris Robinson, 2008. "Human Capital Specificity: Evidence from the Dictionary of Occupational Titles and Displaced Worker Surveys, 1984-2000," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 26(3), pages 387-420, 07.
  16. repec:ubc:bricol:95-40 is not listed on IDEAS
  17. Parent, Daniel, 1999. "Wages and Mobility: The Impact of Employer-Provided Training," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 17(2), pages 298-317, April.
  18. Bauer, Thomas K. & Haisken-DeNew, John P., 2000. "Employer Learning and the Returns to Schooling," IZA Discussion Papers 146, Institute for the Study of Labor (IZA).
  19. Arnaud Chevalier & Colm Harmon & Ian Walker & Yu Zhu, 2004. "Does Education Raise Productivity, or Just Reflect it?," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 114(499), pages F499-F517, November.
  20. Goldin, Claudia & Katz, Lawrence F, 1996. "Technology, Skill, and the Wage Structure: Insights from the Past," American Economic Review, American Economic Association, American Economic Association, vol. 86(2), pages 252-57, May.
  21. Kevin Denny & Colm Harmon, 2001. "Testing for sheepskin effects in earnings equations: evidence for five countries," Applied Economics Letters, Taylor & Francis Journals, Taylor & Francis Journals, vol. 8(9), pages 635-637.
  22. Joseph G. Altonji & Charles R. Pierret, . "Employer Learning and Statistical Discrimination," IPR working papers, Institute for Policy Resarch at Northwestern University 97-18, Institute for Policy Resarch at Northwestern University.
  23. Bollinger, Christopher R. & Hirsch, Barry, 2005. "Match Bias from Earnings Imputation in the Current Population Survey: The Case of Imperfect Matching," IZA Discussion Papers 1846, Institute for the Study of Labor (IZA).
  24. Robert E. Hall, 1984. "The Importance of Lifetime Jobs in the U.S. Economy," NBER Working Papers 0560, National Bureau of Economic Research, Inc.
  25. McDonald, J.T. & Worswick, C., 1997. "Wages, Implicit Contracts and the Business Cycle: Evidence from Canadian Micro Data," Department of Economics - Working Papers Series, The University of Melbourne 588, The University of Melbourne.
  26. Heywood, John S., 1994. "How widespread are sheepskin returns to education in the U.S.?," Economics of Education Review, Elsevier, Elsevier, vol. 13(3), pages 227-234, September.
  27. Kelly Bedard, . "Human Capital Versus Signaling Models: University Access and High School Drop-outs," Claremont Colleges Working Papers, Claremont Colleges 1999-01, Claremont Colleges.
  28. S. Mcguinness, 2003. "Graduate overeducation as a sheepskin effect: evidence from Northern Ireland," Applied Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 35(5), pages 597-608.
  29. Vincenzo Caponi & Miana Plesca, 2009. "Post-secondary education in Canada: can ability bias explain the earnings gap between college and university graduates?," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 42(3), pages 1100-1131, August.
  30. Parent, Daniel, 2000. "Industry-Specific Capital and the Wage Profile: Evidence from the National Longitudinal Survey of Youth and the Panel Study of Income Dynamics," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 18(2), pages 306-23, April.
  31. Ana M. Ferrer & W. Craig Riddell, 2002. "The role of credentials in the Canadian labour market," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 35(4), pages 879-905, November.
  32. Ono, Hiroshi, 2006. "Lifetime Employment in Japan: Concepts and Measurements," Working Paper Series in Economics and Finance 624, Stockholm School of Economics, revised 06 Apr 2007.
  33. Christina Gathmann & Uta Schönberg, 2010. "How General Is Human Capital? A Task-Based Approach," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 28(1), pages 1-49, 01.
  34. Groot, Wim & Oosterbeek, Hessel, 1994. "Earnings Effects of Different Components of Schooling: Human Capital versus Screening," The Review of Economics and Statistics, MIT Press, vol. 76(2), pages 317-21, May.
  35. Robert Jensen, 2010. "The (Perceived) Returns to Education and the Demand for Schooling," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 125(2), pages 515-548, May.
  36. Spence, A Michael, 1973. "Job Market Signaling," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 87(3), pages 355-74, August.
  37. Goldin, Claudia, 1998. "America's Graduation from High School: The Evolution and Spread of Secondary Schooling in the Twentieth Century," Scholarly Articles 2664307, Harvard University Department of Economics.
  38. Michael T. Kiley, 1997. "The supply of skilled labor and skill-based technological progress," Finance and Economics Discussion Series, Board of Governors of the Federal Reserve System (U.S.) 1997-45, Board of Governors of the Federal Reserve System (U.S.).
  39. Fernando Galindo-Rueda, 2003. "Employer Learning and Schooling-Related Statistical Discrimination in Britain," CEE Discussion Papers, Centre for the Economics of Education, LSE 0031, Centre for the Economics of Education, LSE.
  40. Parrado, Eric & Caner, Asena & Wolff, Edward N., 2007. "Occupational and industrial mobility in the United States," Labour Economics, Elsevier, Elsevier, vol. 14(3), pages 435-455, June.
  41. Riley, John G, 1979. "Testing the Educational Screening Hypothesis," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 87(5), pages S227-52, October.
  42. Godo, Yoshihisa & Hayami, Yujiro, 2002. "Catching Up in Education in the Economic Catch-Up of Japan with the United States, 1890-1990," Economic Development and Cultural Change, University of Chicago Press, vol. 50(4), pages 961-78, July.
  43. Michael Spence, 2002. "Signaling in Retrospect and the Informational Structure of Markets," American Economic Review, American Economic Association, American Economic Association, vol. 92(3), pages 434-459, June.
  44. Katz, Lawrence & Gibbons, Robert & Lemieux, Thomas & Parent, Daniel, 2005. "Comparative Advantage, Learning, and Sectoral Wage Determination," Scholarly Articles 2766651, Harvard University Department of Economics.
  45. Broadberry, S N, 1994. "Technological Leadership and Productivity Leadership in Manufacturing since the Industrial Revolution: Implications for the Convergence Debate," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 104(423), pages 291-302, March.
  46. Joshua C. Pinkston, 2006. "A Model of Asymmetric Employer Learning With Testable Implications," Working Papers, U.S. Bureau of Labor Statistics 390, U.S. Bureau of Labor Statistics.
  47. Mary Silles, 2007. "Sheepskin effects in the returns to education," Applied Economics Letters, Taylor & Francis Journals, Taylor & Francis Journals, vol. 15(3), pages 217-219.
  48. Ana Ferrer & W. Craig Riddell, 2008. "Education, credentials, and immigrant earnings," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 41(1), pages 186-216, February.
  49. Kuhn, Peter J. & Weinberger, Catherine, 2002. "Leadership Skills and Wages," IZA Discussion Papers 482, Institute for the Study of Labor (IZA).
  50. Fallon, P R & Layard, P R G, 1975. "Capital-Skill Complementarity, Income Distribution, and Output Accounting," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 83(2), pages 279-301, April.
  51. Fernando Galindo-Rueda, 2003. "Employer learning and schooling-related statistical discrimination in Britain," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 19491, London School of Economics and Political Science, LSE Library.
  52. Baker, George & Holmstrom, Bengt, 1995. "Internal Labor Markets: Too Many Theories, Too Few Facts," American Economic Review, American Economic Association, American Economic Association, vol. 85(2), pages 255-59, May.
  53. Robert Gibbons & Michael Waldman, 1999. "A Theory Of Wage And Promotion Dynamics Inside Firms," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 114(4), pages 1321-1358, November.
  54. Pinkston, Joshua C., 2003. "Screening discrimination and the determinants of wages," Labour Economics, Elsevier, Elsevier, vol. 10(6), pages 643-658, December.
  55. Harry Anthony Patrinos, 1996. "Non-linearities in the returns to education: sheepskin effects or threshold levels of human capital?," Applied Economics Letters, Taylor & Francis Journals, Taylor & Francis Journals, vol. 3(3), pages 171-173.
  56. Katz, Lawrence F. & Revenga, Ana L., 1989. "Changes in the structure of wages: The United States vs Japan," Journal of the Japanese and International Economies, Elsevier, vol. 3(4), pages 522-553, December.
  57. Joni Hersch, 2008. "Profiling the New Immigrant Worker: The Effects of Skin Color and Height," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 26(2), pages 345-386, 04.
  58. John H. Tyler & Richard J. Murnane & John B. Willett, 2000. "Estimating The Labor Market Signaling Value Of The GED," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 115(2), pages 431-468, May.
  59. Yukiko Abe, 2000. "A Comparison of Wage Structures in the United States and Japan: Results from Cell Mean Regressions," The Japanese Economic Review, Japanese Economic Association, Japanese Economic Association, vol. 51(2), pages 252-267, 06.
  60. Layard, Richard & Psacharopoulos, George, 1974. "The Screening Hypothesis and the Returns to Education," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 82(5), pages 985-98, Sept./Oct.
  61. Bitzan, John D., 2009. "Do sheepskin effects help explain racial earnings differences?," Economics of Education Review, Elsevier, Elsevier, vol. 28(6), pages 759-766, December.
  62. Beaudry, Paul & DiNardo, John, 1991. "The Effect of Implicit Contracts on the Movement of Wages over the Business Cycle: Evidence from Micro Data," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 99(4), pages 665-88, August.
  63. Gordon, Robert J, 1982. "Why U.S. Wage and Employment Behaviour Differs from That in Britain and Japan," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 92(365), pages 13-44, March.
  64. Empar Pons, 2006. "Diploma Effects by Gender in the Spanish Labour Market," LABOUR, CEIS, CEIS, vol. 20(1), pages 139-157, 03.
  65. Baker, George & Gibbs, Michael & Holmstrom, Bengt, 1994. "The Internal Economics of the Firm: Evidence from Personnel Data," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 109(4), pages 881-919, November.
  66. Munich, Daniel & Svejnar, Jan & Terrell, Katherine, 2005. "Is women's human capital valued more by markets than by planners?," Journal of Comparative Economics, Elsevier, vol. 33(2), pages 278-299, June.
  67. Moriguchi, Chiaki, 2003. "Implicit Contracts, the Great Depression, and Institutional Change: A Comparative Analysis of U.S. and Japanese Employment Relations, 1920 1940," The Journal of Economic History, Cambridge University Press, Cambridge University Press, vol. 63(03), pages 625-665, September.
  68. Goldin, Claudia & Margo, Robert A, 1992. "The Great Compression: The Wage Structure in the United States at Mid-century," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 107(1), pages 1-34, February.
  69. Novack, David E. & Perlman, Richard, 1962. "The Structure of Wages in the American Iron and Steel Industry, 1860–1890," The Journal of Economic History, Cambridge University Press, Cambridge University Press, vol. 22(03), pages 334-347, September.
  70. Belman, Dale & Heywood, John S, 1997. "Sheepskin Effects by Cohort: Implications of Job Matching in a Signaling Model," Oxford Economic Papers, Oxford University Press, vol. 49(4), pages 623-37, October.
  71. Fabian Lange, 2007. "The Speed of Employer Learning," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 25, pages 1-35.
  72. Lang, Kevin & Kropp, David, 1986. "Human Capital versus Sorting: The Effects of Compulsory Attendance Laws," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 101(3), pages 609-24, August.
  73. Oliver E. Williamson & Michael L. Wachter & Jeffrey E. Harris, 1975. "Understanding the Employment Relation: The Analysis of Idiosyncratic Exchange," Bell Journal of Economics, The RAND Corporation, The RAND Corporation, vol. 6(1), pages 250-278, Spring.
  74. Weinberg, Bruce A, 2001. "Long-Term Wage Fluctuations with Industry-Specific Human Capital," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 19(1), pages 231-64, January.
  75. Park, Jin Heum, 1999. "Estimation of sheepskin effects using the old and the new measures of educational attainment in the Current Population Survey," Economics Letters, Elsevier, Elsevier, vol. 62(2), pages 237-240, February.
  76. Arrow, Kenneth J., 1973. "Higher education as a filter," Journal of Public Economics, Elsevier, Elsevier, vol. 2(3), pages 193-216, July.
  77. Hungerford, Thomas & Solon, Gary, 1987. "Sheepskin Effects in the Returns to Education," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 175-77, February.
  78. Hashimoto, Masanori & Raisian, John, 1985. "Employment Tenure and Earnings Profiles in Japan and the United States," American Economic Review, American Economic Association, American Economic Association, vol. 75(4), pages 721-35, September.
Full references (including those not matched with items on IDEAS)

Citations

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:pra:mprapa:30749. 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: (Ekkehart Schlicht).

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.