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Are Those Paid More Really No More Productive? Measuring the Relative Importance of Tenure Versus On-The-Job Training in Explaining Wage Growth

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  • James N. Brown

    (Princeton University)

Abstract

This paper considers the growth in wages that employees experience with increasing tenure in a given position. More specifically, the work presented in this paper seeks to determine how much of this observed wage growth can be attributed to on-the-job training and how much remains to be attributed to other factors that might cause wages to increase with tenure independently of training or productivity. The basic finding of this work is that on-the-job training appears to explain a substantial share of the total wage growth experienced in a given position. Indeed, there appears to be little wage growth remaining to be explained by other factors, once training is completed or has been held constant.

Suggested Citation

  • James N. Brown, 1983. "Are Those Paid More Really No More Productive? Measuring the Relative Importance of Tenure Versus On-The-Job Training in Explaining Wage Growth," Working Papers 549, Princeton University, Department of Economics, Industrial Relations Section..
    • Handle: RePEc:pri:indrel:169
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    Citations

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    Cited by:

    1. Joseph G. Altonji & Robert A. Shakotko, 1987. "Do Wages Rise with Job Seniority?," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 54(3), pages 437-459.
    2. Feng, Shuaizhang, 2009. "Return to Training and Establishment Size: A Reexamination of the Size-Wage Puzzle," IZA Discussion Papers 4143, Institute of Labor Economics (IZA).
    3. Michael Waldman, 1988. "Interpreting Evidence on Returns to Tenure: The Significance of Quasi-Specific Human Capital," UCLA Economics Working Papers 479, UCLA Department of Economics.
    4. repec:eee:labchp:v:2:y:1986:i:c:p:789-848 is not listed on IDEAS
    5. Harry J. Holzer, 1988. "The Determinants of Employee Productivity and Earnings: Some New Evidence," NBER Working Papers 2782, National Bureau of Economic Research, Inc.
    6. Peter Berg, 1994. "Strategic Adjustments in Training: A Comparative Analysis of the U.S. and German Automobile Industries," NBER Chapters, in: Training and the Private Sector: International Comparisons, pages 77-108, National Bureau of Economic Research, Inc.
    7. Feng, Shuaizhang & Zheng, Bingyong, 2010. "Imperfect Information, On-the-Job Training, and the Employer Size-Wage Puzzle: Theory and Evidence," IZA Discussion Papers 4998, Institute of Labor Economics (IZA).
    8. Ann P. Bartel, 1989. "Formal Employee Training Programs and Their Impact on Labor Produc- tivity: Evidence from a Human Resources Survey," NBER Working Papers 3026, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative

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