Experience vs. Obsolescence: A Vintage-Human-Capital Model Report as inadecuate

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I introduce endogenous human-capital accumulation into an infinite-horizon version of Chari and Hopenhayn-s 1991 vintage-human-capital model. Different skill levels inside a vintage are complementary in production. I establish equivalence between competitive equilibrium and a planner-s problem, which ensures uniqueness of equilibrium. Returns to skill and tenure premia are highest in young vintages, where skill is scarcest and agents accumulate human capital fastest. As the vintage ages, the skill premium decreases and vanishes entirely upon vintage death. The results are in line with German linked employer-employee data: Young establishments pay higher tenure premia but lower mean wages than old establishments.

Item Type: MPRA Paper -

Original Title: Experience vs. Obsolescence: A Vintage-Human-Capital Model-

Language: English-

Keywords: Vintage human capital, tenure-wage profiles-

Subjects: E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy > E24 - Employment ; Unemployment ; Wages ; Intergenerational Income Distribution ; Aggregate Human Capital ; Aggregate Labor ProductivityJ - Labor and Demographic Economics > J0 - General > J01 - Labor Economics: General-

Author: Kredler, Matthias

Source: https://mpra.ub.uni-muenchen.de/18933/


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