The Review of Economics and Statistics Vol. 72 No. 1 1990
Do Earnings Increase with Job Seniority?
open access
Abstract
Cross-sectional wage regressions overstate the extent to which earnings increase with job seniority because they fail to take account of the sorting which occurs when high wage workers have lower rates of mobility. The main source of bias is a negative correlation between turnover probabilities and (unobserved) market valued individual characteristics which are transferable across firms. These results argue for the importance of theories which emphasize generally applicable individual differences and against those which focus on firm-specific attributes.
- DOI
- 10.2307/2109750
- Volume
- 72
- Issue
- 1
- Pages
- 143
- Sources
- crossref openalex