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Individual Wage Growth: The Role of Industry Experience

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  • Michele Battisti

Abstract

This paper focuses on the effect of experience within an industry on wages. I use a correlated random effects simultaneous equation model that allows individual and match heterogeneity to affect wages, job tenure and industry experience. I estimate my model separately for men and women using a large panel of young Italian workers for the years 1986–2004. Results show that wage returns to industry experience are much higher than wage returns to job seniority. The hypotheses of exogeneity of job seniority and industry experience in the wage equation are rejected: high-wage workers and highwage matches last longer.

Suggested Citation

  • Michele Battisti, 2013. "Individual Wage Growth: The Role of Industry Experience," ifo Working Paper Series 152, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
  • Handle: RePEc:ces:ifowps:_152
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    References listed on IDEAS

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    Cited by:

    1. Francesca Sgobbi & Fátima Suleman, 2015. "The Value of Transferable Skills," Scottish Journal of Political Economy, Scottish Economic Society, vol. 62(4), pages 378-399, September.

    More about this item

    Keywords

    Wage growth and industry experience; firm tenure; simultaneous equation models; random effects; Worker History Italian Panel (WHIP) dataset;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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