Early-Career Work Experience and Gender Wage Differentials

Abstract

We estimate a wage model that includes an array of variables measuring the fraction of time worked during each year of the career. This array fully characterizes past employment experience, regardless of how sporadic it has been. Our model yields substantially higher estimated returns to experience and lower returns to tenure than do models that measure experience cumulatively and use the standard quadratic functional form. We find that the data reject the standard model but fail to reject our model. Furthermore, we find that 12% of the male-female wage gap is due to differences in the timing of work experience.

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