Gu, Ran (2022) 'Human Capital and the Business Cycle Effects on the Postgraduate Wage Premium.' Review of Economic Dynamics. ISSN 1094-2025 (In Press)
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Abstract
Postgraduate degree holders experience lower cyclical variation in real wages than those with undergraduate degrees. Moreover, postgraduate jobs require more spe- cific human capital. Using an equilibrium search model with dynamic incentive contracts, this paper attributes the cyclicality of the postgraduate-undergraduate wage gap to the differences in specific capital. Greater specific capital leads to lower mobility, thereby improving risk-sharing between workers and firms. The estimates of the model reveal that specific capital can explain the differences both in labour turnover and in real wage cyclicality between education groups.
Item Type: | Article |
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Uncontrolled Keywords: | real wage cyclicality; education; wage premium; specific human capital; wage contract; search |
Divisions: | Faculty of Social Sciences > Economics, Department of |
SWORD Depositor: | Elements |
Depositing User: | Elements |
Date Deposited: | 11 Feb 2022 20:43 |
Last Modified: | 11 Feb 2022 20:43 |
URI: | http://repository.essex.ac.uk/id/eprint/32163 |
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