Heterogeneity in Returns to Work Experience: A Dynamic Model of Female Labor Force Participation

• Main Author: YAMADA, Ken
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2009
• Subjects: Labor Economics
• Online Access: https://ink.library.smu.edu.sg/soe_research/1144; https://ink.library.smu.edu.sg/context/soe_research/article/2143/viewcontent/Yamada_RtE200908b.pdf
• Institution: Singapore Management University

This paper provides structural estimates of heterogeneous returns to work experience for Japanese married women. A dynamic model of labor force participation is used to account for dynamic selfselection into employment. Heterogeneity is incorporated into the model in a way that allows for the multidimensional skill heterogeneity in employment and home production and for the individual-specific slope and curvature of experience effect on earnings. The structural estimates and their comparison to the reduced-form estimates highlight the importance of dynamic self-selection into employment and heterogeneity in returns to work experience.