Differences In Human Capital Investments Research Articles

The Clan Imprint Within Gender Wage Gap: Evidence from China

Clan culture plays a pivotal role in shaping gender disparities in individual choices. This paper, utilizing data from Chinese General Social Survey 2013, employs genealogy density as a proxy variable for clan culture. The results suggest that clan culture significantly promotes an increase in male wage, while no significant impact on female wage, consequently widening the gender wage gap. Notably, patrilineal clan exacerbates gender differences in human capital investment, reinforces gender identity, and intensifies social trust disparities, thereby perpetuating the escalation of gender wage inequality. Conversely, the internet, serving as a primary vehicle for modern gender equality ideas, mitigates the positive effect of clan on gender wage disparity. Further investigation reveals that the positive impact of clan culture on gender wage gap diminishes with an upward shift in wage distribution and narrows with generational transitions. These findings extend the cultural explanation pathway for gender wage gap.

Share the love: Parental bias, women empowerment and intergenerational mobility

This study provides empirical evidence and develops a model that captures the complex intra-household bargaining interactions and gender-based intergenerational occupational mobility. Using panel data from Nigeria, our estimates show that greater intra-household female bargaining power leads to greater intergenerational occupational mobility for sons more than daughters. Similarly, the median age at first marriage has a positive impact on occupational mobility for both daughters and sons. However, benefit is larger for sons. In the model, parental gender bias is modeled as non-pecuniary (psychic) cost – a representation of parents’ pessimistic attitude towards their children’s adulthood outcomes – which negatively affects the marginal benefit of investing in children’s human capital. The decision of parents is critical in determining children’s mobility and becomes the basis of gender-based differences in human capital investment and intergenerational persistence.

The Career Evolution of the Sex Gap in Wages: Discrimination vs. Human Capital Investment

Several studies find that there is little sex gap in wages at labor market entry, and that the sex gap in wages emerges (and grows) with time in the labor market. This evidence is consistent with (i) there is little or no sex discrimination in wages at labor market entry, and (ii) the emergence of the sex gap in wages with time in the labor market reflects differences between men and women in human capital investment (and other decisions), with women investing less early in their careers. Indeed, some economists explicitly interpret the evidence this way. We show that this interpretation ignores two fundamental implications of the human capital model, and that differences in investment can complicate the interpretation of both the starting sex gap in wages (or absence of a gap), and the differences in “returns” to experience. We then estimate stylized structural models of human capital investment and wage growth to identify the effects of discrimination and differences in human capital investment, and find evidence more consistent with discrimination reducing women’s wages at labor market entry.

Cash Transfers and Gender Differentials in Child Schooling and Labor: Evidence from the Lesotho Child Grants Programme

Cash Transfers and Gender Differentials in Child Schooling and Labor: Evidence from the Lesotho Child Grants Programme

Correlation of Brothers' Earnings and Intergenerational Transmission

Correlations between parent and child earnings reflect intergenerational mobility and, more broadly, correlations between siblings' earnings reflect shared community and family background. These earnings relationships capture important aspects of relations in socioeconomic status more generally. We estimate intergenerational transmission and sibling correlations of life-cycle earnings jointly within a unified framework that nests previous models. Using data on the Danish population of father/first-son/second-son triads we find that intergenerational effects account for on average 72 percent of sibling correlations. This share is higher than all previous studies because we allow for heterogeneous intergenerational transmission between families. Sibling correlations exhibit a U-shape over the working life, consistent with differences in human capital investments between families.

Correlations of Brothers' Earnings and Intergenerational Transmission

Correlations between parent and child earnings reflect intergenerational mobility and, more broadly, correlations between siblings' earnings reflect shared community and family background. These earnings relationships capture important aspects of relations in socioeconomic status more generally. We estimate intergenerational transmission and sibling correlations of life-cycle earnings jointly within a unified framework that nests previous models. Using data on the Danish population of father/first-son/second-son triads we find that intergenerational effects account for on average 72 percent of sibling correlations. This share is higher than all previous studies because we allow for heterogeneous intergenerational transmission between families. Sibling correlations exhibit a U-shape over the working life, consistent with differences in human capital investments between families.

Gender wage differences in Nigerian self and paid employment: Do marriage and children matter?

AbstractThis article investigates gender differences in Nigeria, in the impact of marriage and children on location in the self or waged employment sector, and on income from work. Findings show that the pay structure varies across employment sectors – waged and self-employed – and that the determinants of employment sector vary by gender and family roles. Differences in human capital investment and geopolitical zones also need to be considered. The estimates in the study reveal that there is a marriage premium for both males and females in the waged labour market, but partially support Becker’s (1991) gender-based household specialisation model in terms of the relative incidence of self-employment. There is a wage penalty for married women with children in the paid-employment labour market, but motherhood is also negatively associated with income levels for self-employed women. We also find a fatherhood penalty for paid-employed men. Nevertheless, overall, the gender difference is higher in relatively less regulated self-employment compared to the more regulated paid employment labour market. Findings therefore offer some policy inputs but also suggest the need for further research into the causes of the gender pay gap in self- and paid employment, and thus into the overall wage gap in Nigeria that inhibits women’s labour market participation and welfare.

A quantitative theory of the gender gap in wages

This paper measures how much of the gender wage gap over the life cycle is due to the fact that working hours are lower for women than for men. We build a quantitative theory of fertility, labor supply, and human capital accumulation decisions to measure gender differences in human capital investments over the life cycle. We assume that there are no gender differences in the human capital technology and calibrate this technology using wage–age profiles of men. The calibration of females assumes that children involves a forced reduction in hours of work that falls on females rather than on males and that there is an exogenous gender gap in hours of work. We find that our theory accounts for all of the increase in the gender wage gap over the life cycle in the NLSY79 data. The impact of children on the labor supply of females accounts for 56% and 45% of the increase in the gender wage gap over the life cycle among non-college and college females, while the rest is due to the exogenous gender differences in hours of work.

Gender Gaps in High School Students’ Homework Time

Gender differences in human capital investments made outside of the traditional school day suggest that males and females consume, respond to, and form habits relating to education differently. We document robust, statistically significant one-hour weekly gender gaps in secondary students’ non-school study time using time diary data from the 2003–2012 waves of the American Time Use Survey (ATUS) and transcript data from the Educational Longitudinal Study of 2002 (ELS). These complementary data sets provide consistent evidence of gender gaps that favor females and are not explained by gender differences in after-school time use, parental involvement, educational expectations, course taking, past academic achievement, or cognitive ability.

Human Capital and Economic Growth: A Three Stage Least Squares Approach

It can never be overemphasized that human capital is the engine of growth of an economy. No nation can develop beyond its investment in education in particular. Growth economists in affirmation have explained that the differences in the per capita income of countries cannot be explained in isolation from the differences in human capital development. For early classical economists, economic growth had always been closely linked with physical capital, to the neo classicals - human capital, while the endogenous growth scholars linked economic growth with technology, which is a function of human capital. We conclude then that growth differences among nations can be better understood by studying the differences in human capital investment. In Nigeria, available data makes it clear that there has been severe under investment in education and health sectors. The government is far from complying with the UNESCO’s 26% and African Leaders’ 15% minimum budgetary benchmark to both sectors respectively. This paper therefore examines the role of government investment in human capital on economic growth of the Nigerian economy. Using time series data from 1980-2010, the paper adopted the Ordinary Least Squares (OLS) and 3 Stage Least Squares analytical technique, in an Augmented Human Capital Solow theoretical framework. The study found that human capital alongside with technological development and population growth has a positive relationship with growth of the Nigerian economy. The model confirmed that adequately trained and employed population enhances the growth of the economy. However, high mortality and unemployment rate remain the greatest challenge to education in Nigeria. It further revealed that the Nigerian experience does not support Solow’s hypothesis of high population growth/low productivity relationship. When Solow’s full employment assumption is relaxed, high population growth rather enhances productivity. The study also found that education has the greatest marginal impact on life expectancy. The study interestingly makes it clear that although the private sector benefits maximally from an educated population, she may not invest adequately in human capital development. However, both the rent- seeking and non-rent seeking behaviour of economic agents are estimated to impact positively on economic growth of Nigeria directly or indirectly. The study therefore recommends an urgent need for government to strategically shift her investments towards the continuous development of effective and efficient human capital. This will serve as the foundation for an effective development of an organized private sector.

The political economy of educational content and development: Lessons from history

Beyond years of schooling, educational content can play an important role in the process of economic development. Individuals' choices of educational content are often shaped by the political economy of government policies that determine the incentives to acquire various skills. We first present a model in which differences in human capital investments emerge as an equilibrium outcome of private decisions and government policy choices. We then illustrate these dynamics in two historical circumstances. In medieval Europe, states and the Church found individuals trained in Roman law valuable, and eventually supported productive investments in this new form of human capital. In late 19th-century China, elites were threatened by the introduction of Western science and engineering and continued to select civil servants—who enjoyed substantial rents—based on their knowledge of the Confucian classics; as a result, investments in productive, modern human capital were not made.

The Political Economy of Educational Content and Development: Lessons from History

Beyond years of schooling, educational content can play an important role in the process of economic development. Individuals’ choices of educational content are often shaped by the political economy of government policies that determine the incentives to acquire various skills. We first present a model in which differences in human capital investments emerge as an equilibrium outcome of private decisions and government policy choices. We then illustrate these dynamics in two historical circumstances. In medieval Europe, states and the Church found individuals trained in Roman law valuable, and eventually supported productive investments in this new form of human capital. In late 19th-century China, elites were threatened by the introduction of Western science and engineering and continued to select civil servants — who enjoyed substantial rents — based on their knowledge of the Confucian classics; as a result, investments in productive, modern human capital were not made.

Wages, earnings, and occupational status: did World War II veterans receive a premium?

Over 16 million men served during World War II (WWII), and we know that veterans obtained more education and earned higher incomes than did non-veterans and that these premiums were more substantial for Blacks and less educated men. However, we know very little about the reasons for such veteran premiums. Using several distinct, yet connected, theoretical traditions that have been used to link military service to subsequent outcomes—theories of the life course, the status attainment perspective, relatively new conceptualizations of social capital, economic theories of human capital, and theories of selectivity—we seek to redress this lack of understanding. We use survey data from the National Longitudinal Study of Mature Men (NLSMM) to examine the long-term effects of military service during WWII on occupational and income attainments. We find that the effects associated with being a veteran of WWII are modest and are mostly limited to less advantaged veterans, and can be largely explained by differences in human capital investment or selectivity. The one finding that cannot be explained by differences in family background, human capital investments, and selectivity is a higher hourly wage rate associated with being a Black veteran.

Gender and Pay in Taiwan

In Taiwan as in the United States, even in the same industry and status there is an earnings gap between men and women. The same question concerning attitudes toward pay for equal work was asked of two independently-drawn samples of male Taiwanese living in Taipei, the first time in 1963, and again in 1991. While 68% favored equal pay in 1963, this percent did not change significantly in the 1991 sample, despite 28 years of rapid and massive economic development and societal modernization. The respondents used a similar repertory of reasons they supported or opposed equal pay for women in 1963 and 1991. To explain why the majority favored, but a minority opposed, equal pay, this attitude was regressed on three sets of hypothesized causal variables: a person's objective status, subjective life chances, and involvement in the kinship system. The logistic regression analysis shows that the variables with a significant impact on the log odds of a man's favoring equal pay for women were largely different in 1991 as compared with 1963. We discuss the implications of the findings in the light of neoclassical economic theories of gender differences in human capital investment and statistical discrimination, sociological theories of job segregation and the structure of labor markets, and feminist theories of patriarchy.

The declining marital-status earnings differential.

"Earnings differentials between married and unmarried [U.S.] men have been declining since the late 1960s. We consider two possible explanations for this decline: changes in the nature of selection into marriage; and changes in role specialization within marriage. Our analysis of changes in marriage differentials within cohorts supports only a small contribution of changes in selection. There is some evidence that differences in human-capital investment between married and unmarried men have fallen over time, but this effect has apparently been largely offset by increases in the return to that human capital." This is a revised version of a paper originally presented at the 1991 Annual Meeting of the Population Association of America.

Do Parents Favor Boys?

In an optimizing model of parental allocation systematic differences in human capital investments betwen the sexes may originate in at least 3 ways. 1) Parents may respond to expected gender wage differentials. 2) Parents may respond to systematic differences by gender in the price of human capital investments. 3) Parental preferences may favor girls or boys in the sense that they value identical outcomes at the same cost more highly for one sex than for the other. This paper analyzes the role of parental preferences in general and unequal concern in particular in the allocation of human capital investments among children. The authors generalize their earlier model of the human capital investments among children to incorporate the possibility that the returns to such investments may include not only the childs own ecpected earnings but also the expected earnings of his or her spouse. Thus the model assumes that parents may value returns that accrue trough the marriage market as well as through education. The relevant returns to education may include marrying a spouse with higher expected earnings. The empirical analysis indicates that gender wage differentials like endowment differentials are mildly reinforced by the parental allocation of human capital investments. Marriage market outcomes are significant determinants of the allocation of human capital investments among children. There is no evidence that parental preferences favor boys; this study shows that parental preferences either exhibit equal concern or slightly favor gils.

Occupational Earnings, Compensating Differentials, and Human Capital: An Empirical Study

This paper examines the empirical significance of the principle of compensating differentials for the occupational distribution of earnings in Canada. The estimated earnings equation relates differentials in earnings to differences in human capital investments of workers, training requirements, and other non-pecuniary characteristics of occupational employments. The evidence suggests that wage differentials are primarily 'equalizing differentials': workers receive higher pay in compensation for their higher schooling and work experience and for undertaking jobs that are risky, insecure, and require higher levels of general educational development and specific vocational preparation. The evidence also confirms the findings of hedonic wage equations that returns to schooling and experience may be biased when occupational requirements are not controlled. Salaires dans diverses occupations, diffrrentiels compensatoires, et capital humain: une etude empirique. Ce memoire examine la signification empirique du principe des diff6rentiels compensatoires pour expliquer l'eventail des salaires selon les occupations au Canada. Une equation des gains estimes etablit la relation entre les salaires et les differences dans les investissements en capital humain des travailleurs, la longueur de la periode d'apprentissage necessaire, et les autres avantages non-pecuniers attaches 'a une occupation. Les resultats suggerent que les differentiels de salaire sont d'abord et avant tout des diff6rentiels qui vont dans le sens de l'egalisation: les travailleurs reqoivent un salaire plus eleve en compensation pour le niveau d'experience et d'6education plus eleve qui est necessaire, et pour des travaux plus dangereux, moins stables et requerant des niveaux eleves d'instruction et une preparation particuliere. Les resultats confirment aussi les resultats derives d'equations de salaire de type hedonique indiquant que les rendements sur l'investissement en instruction et en experience peuvent etre fausses si on ne standardise pas les exigences des differentes occupations. The principle of compensating differentials outlined by Adam Smith in The Wealth of Nations is one of the many ideas of classical economists that have become a 'common place of economics. '1 The idea that differences in pecuniary wages are required to The authors wish to thank Steve Kaliski, Mike Abbott, and the Editor and anonymous referees for their helpful comments and suggestions. The financial assistance from Labour Canada on the initial phases of this study is gratefully acknowledged. 1 See Rees (1975) and McNulty (1980). According to Rees, 'Of the many ideas of Adam Smith that have stood the test of time, few have weathered better or are still more relevant than the idea of compensating wage differentials ... it would be hard to imagine a theory of relative wages that did not Canadian Journal of Economics / Revue canadienne d'Economique, XV, No. 3 August / aoet 1982. Printed in Canada / Imprimd au Canada 0008-4085 / 82 / 0000-0442 $01.50 (? 1982 Canadian Economics Association This content downloaded from 157.55.39.27 on Wed, 07 Sep 2016 06:38:18 UTC All use subject to http://about.jstor.org/terms Occupational earnings, compensating differentials / 443 compensate for the non-pecuniary advantages and disadvantages of different employments has remained in its original form for over two hundred years as an established analytical framework for the analysis of wage differentials. In recent years the principle of compensating differentials has sparked considerable theoretical and empirical interest in earnings distributions and their relationship with worker and job attributes. On the theoretical side the compensating principle has inspired the development of two major applied and policy-oriented economic models, the human capital theory and the recent hedonic wage function approach; while the human capital model emphasizes the significance of individual investment behaviour in the heterogeneity of labour incomes and singles out the length of training-formal schooling and informal training or work experience-as the principal compensating wage differential, the hedonic approach focuses on 'quality' variations in both worker and job attributes as an explanation for wage differences. Both models provide empirical conceptualization of the compensating differentials principle and have contributed significantly to a better understanding of labour market behaviour and wage determination processes. On the empirical side the availability of large data sets, incorporating information on both individual worker traits and job characteristics and requirements, and high-speed computers has helped in overcoming difficulties of measurement, thus facilitating empirical estimates of 'compensation' for non-wage characteristics. Consequently, in the past few years there has been a long line of empirical research in the United States relating wage differences to differences in worker and job characteristics.2 These studies have found considerable evidence of compensating wage differentials for jobs requiring additional years of training, together with positive average rates of return on the individual worker's human capital investments. The evidence on the direction and magnitude of compensating differentials for other characteristics, however, is so far inconclusive. Empirical work on these problems is practically non-existent in Canada, largely owing to the absence of appropriate data