This paper investigates the sources of wage growth over the life cycle, where individuals have the possibility to acquire vocational training at the start of their career. Wage growth is determined by sectoral and firm mobility, unobserved abil- ity and the accumulation of human capital. Workers may move between two oc- cupational sectors that require cognitive-abstract (CA) and routine-manual (RM) skills, and job mobility is induced by non-pecuniary job attributes and persistent firm-worker productivity matches. Estimating this model using longitudinal ad- ministrative data over three decades, we show that RM skills are a key driver of early wage growth while CA skills become important later on. Moreover, job amenities are an important determinant of mobility decisions. Vocational training has long term effects on career outcomes, affecting the type and quality of matches, with substantial internal rates of return both to the individual as well as society.

Sources of wage growth

Adda, Jerome Frans
;
Dustmann, Christian
2023

Abstract

This paper investigates the sources of wage growth over the life cycle, where individuals have the possibility to acquire vocational training at the start of their career. Wage growth is determined by sectoral and firm mobility, unobserved abil- ity and the accumulation of human capital. Workers may move between two oc- cupational sectors that require cognitive-abstract (CA) and routine-manual (RM) skills, and job mobility is induced by non-pecuniary job attributes and persistent firm-worker productivity matches. Estimating this model using longitudinal ad- ministrative data over three decades, we show that RM skills are a key driver of early wage growth while CA skills become important later on. Moreover, job amenities are an important determinant of mobility decisions. Vocational training has long term effects on career outcomes, affecting the type and quality of matches, with substantial internal rates of return both to the individual as well as society.
2023
2023
Adda, Jerome Frans; Dustmann, Christian
File in questo prodotto:
File Dimensione Formato  
wagegrowth_final_CJ.pdf

non disponibili

Descrizione: Main article
Tipologia: Documento in Pre-print (Pre-print document)
Licenza: NON PUBBLICO - Accesso privato/ristretto
Dimensione 1.52 MB
Formato Adobe PDF
1.52 MB Adobe PDF   Visualizza/Apri
Adda-JPE-Letter_2021-12-29a_jbp.pdf

non disponibili

Descrizione: Letter of acceptance from the editor
Tipologia: Allegato per valutazione Bocconi (Attachment for Bocconi evaluation)
Licenza: NON PUBBLICO - Accesso privato/ristretto
Dimensione 125.46 kB
Formato Adobe PDF
125.46 kB Adobe PDF   Visualizza/Apri

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11565/4043723
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 5
  • ???jsp.display-item.citation.isi??? 0
social impact