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

Author: 
Ken Yamada
Description: 
Economics and Statistics Working Paper Series
JEL codes: 
Abstract: 
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 self-selection 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.
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