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Does a change of occupation lead to higher earnings?

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  • Barbara Liberda

    ()
    (Faculty of Economic Sciences, University of Warsaw)

  • Marek Pęczkowski

    ()
    (Faculty of Economic Sciences, University of Warsaw)

Abstract

The aim of this paper is to identify how the mobility between different types of broadly defined occupation (hired work, self-employment in industry, services and agriculture or social security beneficiaries) changes personal income of individuals. We apply the Markov matrices to the panel data on 30540 individuals for 2007-2008 from the Polish Household Budget Surveys. Our hypothesis is that a change of occupation affects individual capability to earn income, controlling for the occupation a person quits and the occupation a person starts, as well as age, education level and a permanent or temporary character of work. We test our hypothesis using the regression analysis. Our results show that the inter-occupational mobility matters mostly for those quitting hired work for self-employment, for the better educated, as well as for respondents above 60 years of age.

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File URL: http://www.wne.uw.edu.pl/inf/wyd/WP/WNE_WP49.pdf
File Function: First version, 2011
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Bibliographic Info

Paper provided by Faculty of Economic Sciences, University of Warsaw in its series Working Papers with number 2011-09.

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Length: 14 pages
Date of creation: 2011
Date of revision:
Handle: RePEc:war:wpaper:2011-09

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Keywords: income; earning; mobility; occupation; hired work; self-employment;

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  1. Modigliani, Franco, 1986. "Life Cycle, Individual Thrift, and the Wealth of Nations," American Economic Review, American Economic Association, vol. 76(3), pages 297-313, June.
  2. Milton Friedman, 1957. "Introduction to "A Theory of the Consumption Function"," NBER Chapters, in: A Theory of the Consumption Function, pages 1-6 National Bureau of Economic Research, Inc.
  3. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
  4. Milanovic, Branko, 2007. "Where in the world are you? Assessing the importance of circumstance and effort in a world of different mean country incomes and (almost) no migration," MPRA Paper 3420, University Library of Munich, Germany.
  5. Milton Friedman, 1957. "A Theory of the Consumption Function," NBER Books, National Bureau of Economic Research, Inc, number frie57-1, October.
  6. Barbara Liberda, 1999. "Household Saving in Poland," CASE Network Studies and Analyses 0187, CASE-Center for Social and Economic Research.
  7. Gary S. Becker, 1994. "Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education (3rd Edition)," NBER Books, National Bureau of Economic Research, Inc, number beck94-1, October.
  8. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, October.
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