On Aggregating Human Capital Across Heterogeneous Cohorts

Jakub Growiec; Christian Groth

doi:10.1016/j.mathsocsci.2015.09.003

On Aggregating Human Capital Across Heterogeneous Cohorts

Abstract

This paper studies the question: Can the microeconomic Mincerian (log-linear) functional relationship between human capital, years of schooling and work experience be recovered in some similar form at the macroeconomic level? A large macroeconomic literature assumes so, warranting that the question is of interest. We first examine the question at a theoretical level and find that except under very special assumptions, the answer is in the negative. On the other hand, we also show numerically that a macro-Mincer relationship can nevertheless be perceived as a quantitatively reasonable approximation of the theoretically derived "true" relationship, at least if the observed heterogeneity comes only from differences in the number of years of schooling, retirement age, or demographic survival laws.

Translated title of the contribution	Om aggregeringaf humankapital på tværs af kohorter
Original language	English
Journal	Mathematical Social Sciences
Volume	78
Pages (from-to)	21-38
ISSN	0165-4896
DOIs	https://doi.org/10.1016/j.mathsocsci.2015.09.003
Publication status	Published - 1 Nov 2015

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AB - This paper studies the question: Can the microeconomic Mincerian (log-linear) functional relationship between human capital, years of schooling and work experience be recovered in some similar form at the macroeconomic level? A large macroeconomic literature assumes so, warranting that the question is of interest. We first examine the question at a theoretical level and find that except under very special assumptions, the answer is in the negative. On the other hand, we also show numerically that a macro-Mincer relationship can nevertheless be perceived as a quantitatively reasonable approximation of the theoretically derived "true" relationship, at least if the observed heterogeneity comes only from differences in the number of years of schooling, retirement age, or demographic survival laws.

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On Aggregating Human Capital Across Heterogeneous Cohorts

Abstract

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