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American Economic Review Vol. 105 No. 2 2015

The Price of Experience

Hyeok Jeong1; Yong Kim2; Iourii Manovskii3

1 Seoul National University, Graduate School of International Studies, 1 Gwanak-ro Gwanak-gu, Seoul 151–742, Korea, and KDI School of Public Policy and Management (e-mail: ) · 2 School of Economics, Yonsei University, Daewoo Hall 509, 262 Seongsan-no, Seodaemun-gu, Seoul 120-749, Korea (e-mail: ) · 3 Department of Economics, University of Pennsylvania, 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297 (e-mail: ).

Abstract

We identify a key role of factor supply, driven by demographic changes, in shaping several empirical regularities that are a focus of active research in macro and labor economics. In particular, demographic changes alone can account for the large movements of the return to experience over the last four decades, for the differential dynamics of the age premium across education groups emphasized by Katz and Murphy (1992), for the differential dynamics of the college premium across age groups emphasized by Card and Lemieux (2001), and for the changes in cross-sectional and cohort-based life-cycle profiles emphasized by Kambourov and Manovskii (2005).

DOI
10.1257/aer.20080841
Volume
105
Issue
2
Pages
784-815
Language
en
Sources
bibtex:phds-export.bib openalex crossref

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