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Title: The Experience Premium

Citation Type: Working Paper

Publication Year: 2011

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Abstract: We assess the role of supply, through the demographic changes of the workforce, in accounting for the large changes in the return to labor market experience over time. Using the PSID (1968-2007), we find that the movement of the return to experience is almost perfectly explained by demographic changes alone, with no role attributable to demand shifts. Moreover, these demographic changes account for the differential dynamics of the age premium across education groups emphasized by Katz and Murphy (1992), and account for the differential movements of the college premium across age groups emphasized by Card and Lemieux (2001). Thus, our analysis attributes a key role to demographic change in shaping several empirical regularities that are a focus of active research in macro and labor economics.

Url: https://econpapers.repec.org/paper/bokwpaper/1121.htm

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Authors: Jeong, Hyeok; Kim, Yong; Manovskii, Iourii

Series Title: Economic Research Institute, Bank of Korea

Publication Number: 2011-21

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Data Collections: IPUMS USA

Topics: Population Data Science

Countries: United States