OECD Journal: Economic Studies

Frequency
Annual
ISSN: 
1995-2856 (online)
ISSN: 
1995-2848 (print)
http://dx.doi.org/10.1787/19952856
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OECD Journal: Economic Studies publishes articles in the area of economic policy analysis, applied economics and statistical analysis, generally with an international or cross-country dimension. It draws significantly on economic papers produced by the OECD Economics Department, other parts of the OECD Secretariat and the Organisation’s intergovernmental committees.

Article
 

Experience and the returns to education and skill in OECD countries

Evidence of employer learning? You do not have access to this content

English
 
Click to Access: 
    http://oecd.metastore.ingenta.com/content/1315011ec003.pdf
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Author(s):
Stijn Broecke
22 Dec 2015
Pages:
25
Bibliographic information
No.:
4,
Volume:
2015,
Issue:
1
Pages:
123–147
http://dx.doi.org/10.1787/eco_studies-2015-5jrs3sqrvzg5

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Using the Survey of Adult Skills (PIAAC), this paper documents how the returns to education and skill change with experience for a sample of 22 OECD countries. It does this within the framework of the Altonji and Pierret (2001) employer learning model, and therefore also tests the relevance of this theory in a wide range of countries using comparable data and a consistent methodology. Significant heterogeneity is found in the experience profiles of the returns to education and skill across countries, and convincing evidence in support of the employer learning theory is only found in a sub-set of the countries analysed. While these countries vary significantly from one another in terms of their labour market institutions and educational systems, the analysis does seem to suggest that employer learning is most common in those countries where employment protection legislation on temporary contracts is weak. This is consistent with a model in which temporary contracts allow employers to test and learn about young workers, and give them the flexibility to adjust wages in line with observed productivity.

JEL codes: J24, J32, D83
Keywords: Employer learning, returns to education, returns to skill

 
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