This study analyzes the mobility between three labor market states: working in low paid jobs, working in higher paid jobs and not working. Using German panel data I estimate dynamic multinomial logit panel data models with random effects taking the initial conditions problem and potential...

Models in which employers learn about the productivity of young workers, such as Altonji and Pierret (2001), have two principal implications: First, the distribution of wages becomes more dispersed as a cohort of workers gains experience; second, the coefficient on a variable that employers...

We assess the relevance of formal education for the productivity of the self-employed and distinguish between opportunity entrepreneurs, who voluntarily pursue a business opportunity, and necessity entrepreneurs, who lack alternative employment options. We expect differences in the returns to...

The paper investigates the role of social norms as a determinant of individual attitudes by analyzing risk proclivity reported by immigrants and natives in a unique representative German survey. We employ factor analysis to construct measures of immigrants' ethnic persistence and assimilation....

There are few studies on occupational choices in Germany, and the second generation occupational choice and mobility is even less investigated. Such research is important because occupations determine success in the labor market. In a country like Germany occupations also reflect a general...

We propose a generalized estimating equations approach to the analysis of the mean and the covariance structure of a bivariate time series process of panel data with mixed continuous and discrete dependent variables. The approach is used to jointly analyze wage dynamics and the incidence of...

The aggregate average wage is often used as an indicator of economic performance and welfare, and as such often serves as a benchmark for changes in the generosity of public transfers and for wage negotiations. Yet if economies experience a high degree of (nonrandom) fluctuation in employment...

How individual wages change with time, and how they are expected to change as individuals grow older, is one of crucial determinants of their behaviour on the labour market including their decision to retire. The profile of individual hourly wages has for a long time been assumed to follow an...

European Union economies are pressed by (i) a demographic change that induces population ageing and a decline of the workforce, and (ii) a split labour market that is characterized by high levels of unemployment for low -skilled people and a simultaneous shortage of skilled workers. This lack of...

The empirical finding that entrepreneurs tend to invest a large share of their wealth in their own firms despite comparably low returns and high risk has become known as the private equity premium puzzle. This paper provides evidence supporting the hypothesis that lower risk aversion of...