limor golan | Washington University in St. Louis (original) (raw)

Papers by limor golan

RePEc: Research Papers in Economics, Mar 1, 2011

Fewer women than men become executive managers. They earn less over their careers, hold more juni... more Fewer women than men become executive managers. They earn less over their careers, hold more junior positions, and exit the occupation at a faster rate. We compiled a large panel data set on executives and formed a career hierarchy to analyze mobility and compensation rates. We …nd that, controlling for executive rank and background, women earn higher compensation than men, experience more income uncertainty, and are promoted more quickly. Amongst survivors, being female increases the chance of becoming CEO. Hence, the unconditional gender pay gap and job-rank di¤erences are primarily attributable to female executives exiting at higher rates than men in an occupation where survival is rewarded with promotion and higher compensation.

This paper analyzes the sources of the racial difference in the intergenerational transmission of... more This paper analyzes the sources of the racial difference in the intergenerational transmission of human capital by developing and estimating a dynastic model of parental time and monetary inputs in early childhood with endogenous fertility, home hours, labor supply, marriage, and divorce. It finds that the racial differences in the marriage matching patterns lead to racial differences in labor supply and home hours of couples. Although both the black-white labor market earnings and marriage market gaps are important sources of the black-white achievement gap, the assortative mating and divorce probabilities racial gaps accounts for a larger fraction of it.

Review, 2022

In this article, we document the empirical relationship among juvenile conviction, education, adu... more In this article, we document the empirical relationship among juvenile conviction, education, adult labor market occupational choices, employment, wages, and recidivism. Although several studies have shown that juvenile adjudication is associated with lower formal educational attainment and an increased likelihood of dropping out of high school, no existing study examines human capital accumulation through on-the-job (OTJ) training. Our data are from the National Longitudinal Survey of Youth 1997 (NLSY97) and the Occupational Information Network (O*NET). NLSY97 is a longitudinal survey that follows the lives of a sample of American youth born between 1980-84. It provides detailed information on each individual's convictions and incarcerations over time as well as the age and date of the first time the individual had an interaction with the correctional system. It also collects detailed information on each individual's history of employment, occupations, and wages. Finally, it has information on each This article documents the long-term relationship among juvenile conviction, occupational choices, employment, wages, and recidivism. Using data from the National Longitudinal Survey of Youth 1997 (NLSY97), we document that youth convicted at or before age 17 have a lower full-time employment rate and lower wage growth rate even after 10 years in the labor market. Merging the NLSY97 with occupational characteristics data from the Occupational Information Network (O*NET), we show that youth with a juvenile conviction are less likely to be employed in occupations that have a high on-the-job training requirement and that these occupations have higher wages and wage growth. Accumulated occupation-specific work experience, general experience, and education are important for explaining the gaps in wage and recidivism between youth with and without a juvenile conviction. Our results highlight the important role of occupational choices as a human capital investment vehicle through which juvenile crimes have a longterm impact on wages and recidivism. (JEL K42, I24, J2, J3)

The Review of Economic Studies, Sep 8, 2011

This paper investigates the role of labor-market attachment, on-thejob human-capital accumulation... more This paper investigates the role of labor-market attachment, on-thejob human-capital accumulation, occupational sorting, and discrimination in the narrowing gender earnings gap from 1968-93. This paper contributes in three ways: First, it formulates an estimable dynamic model of labor-supply, occupational sorting and human-capital accumulation in which gender discrimination and the earnings gap arise endogenously. Second, it demonstrates identi cation of such models and develops a three-step estimation technique. Third, it uses the framework to quantify the main driving forces behind the changes in labor-market gender patterns. Increase in overall productivity, demographic changes and statistical discrimination patterns account for a large percentage of the decline in the gender earnings gap and the increase in female labor market experience. Whereas, relative increase in productivity in professional occupations raise representation of women in professional occupations. Further analysis shows that labor-market frictions signi cantly amplify exogenous changes in our model. Without labor-market frictions, the earnings gap would have been smaller by at least 45%. Fewer women would have participated in the labor force, but those who participated would have worked more and earned incomes similar to those of men. We nd that there are signi cantly higher returns to professional occupations and that this has increased greatly over time, accounting for women's increasing representation in professional occupations.

The Regional Economist, 2016

The gender pay gap persists, even within occupations and even though women’s educational attainme... more The gender pay gap persists, even within occupations and even though women’s educational attainments are surpassing men’s. Is it because women tend to choose jobs with hours that are more irregular than those taken by men?

RePEc: Research Papers in Economics, 2008

This paper formulates and estimates a dynamic model of labor supply, occupational sorting, human ... more This paper formulates and estimates a dynamic model of labor supply, occupational sorting, human capital accumulation and discrimination to explain the narrowing gender earnings gap from 1968 to 1993. The paper proves the model is identi…ed and develops a three-step estimation technique. Imperfect information signi…cantly ampli…es exogenous shocks: statistical discrimination accounts for 36 percent of the observed gender earnings gap in the mid-to-late 1970s, declining to 22 percent in the mid-to-late 1980s. Di¤erences in preferences are comparatively less important: the gap would have been at least 56 percent smaller in the mid-to-late 1970s and would have nearly closed by the mid-to-late 1980s if it was driven only be preference. Increases in overall productivity and demographic changes account for a large percentage of the decline in the gender earnings gap and the increase in female labor market experience, while a relative increase in productivity raises women's representation in professional occupations.

Journal of Labor Economics, Oct 1, 2012

Fewer women than men become executive managers. They earn less, hold more junior positions, and a... more Fewer women than men become executive managers. They earn less, hold more junior positions, and attrit faster. We compiled a large panel data set on executives and formed a career hierarchy to analyze promotion and compensation rates. Given executive rank and background, women are paid more than men, experience less income uncertainty, and are promoted as quickly. Amongst survivors, being female increases the chance of becoming CEO. Hence the gender pay gap and job rank di¤erences are primarily attributable to female executives attriting at higher rates than males in an occupation where survival is rewarded with promotion and higher compensation.

University of Economics and Technology. The views expressed are those of the individual authors a... more University of Economics and Technology. The views expressed are those of the individual authors and do not necessarily reect o ¢ cial positions of the Federal Reserve Bank of St. Louis, the Federal Reserve System, or the Board of Governors. This paper explores the estimation of a class of life-cycle discrete choice intergenerational models. It proposes a new semiparametric estimator. It shows that it is p N-consistent and asymptotically normally distributed. We compare our estimator with a modi…ed version of the full solution maximum likelihood estimator (MLE) in a Monte Carlo study. Our estimator performs comparably to the MLE in a …nite sample but greatly reduces the computational cost. The paper documents that the quantity-quality trade-o¤s depend on the household composition and specialization in the household. Using the proposed estimator, we estimate a dynastic model that rationalizes these observed patterns. (JEL classi…cation: C13, J13, J22, J62) 1

Canadian Parliamentary Review, 2021

The labor force participation of women has increased substantially since the 1960s. At the same t... more The labor force participation of women has increased substantially since the 1960s. At the same time, the gender earnings gap has declined from about 40 percent in the late 1960s to less than 28 percent in the early 1990s and has stopped converging since.1 Much of the gender earnings gap is explained by gender differences in labor force attachment and accumulated labor market experience. In particular, the gender earnings gap increases with age as the experience gap increases.2 One explanation for the remaining gender earnings gap is that many jobs disproportionately reward working long hours.3 In many jobs, the pay is nonlinear in hours worked and penalizes workers who choose to work fewer hours. This reward structure tends to affect women of childbearing years disproportionately and also affects their occupational choices. Furthermore, in most occupations, the representation of women at the top-paying jobs is low—even if at lower levels there are many women.4 This article document...

SSRN Electronic Journal, 2015

This paper uses a dynastic model of household behavior to estimate and decomposed the correlation... more This paper uses a dynastic model of household behavior to estimate and decomposed the correlations in earnings across generations. The estimate model can explain 75% to 80% of the observed correlation in lifetime earnings between fathers and sons, mothers and daughters, and families across generations. The main results are that the family and division of labor within the household are the main source of the correlation across generation and not just assorting mating. The interaction of human capital accumulation in labor market, the nonlinear return to part-time versus full-time work, and the return parental time investment in children are the main driving force behind the intergenerational correlation in earnings and assortative mating just magnify these forces.

SSRN Electronic Journal, 2015

This paper explores the estimation of a class of life-cycle discrete choice intergenerational mod... more This paper explores the estimation of a class of life-cycle discrete choice intergenerational models. It proposes a new semiparametric estimator. It shows that it is p N-consistent and asymptotically normally distributed. We compare our estimator with a modi…ed version of the full solution maximum likelihood estimator (MLE) in a Monte Carlo study. Our estimator performs comparably to the MLE in a …nite sample but greatly reduces the computational cost. The paper documents that the quantity-quality trade-o¤s depend on the household composition and specialization in the household. Using the proposed estimator, we estimate a dynastic model that rationalizes these observed patterns.

This paper analyzes the sources of the racial difference in the intergenerational transmission of... more This paper analyzes the sources of the racial difference in the intergenerational transmission of human capital by developing and estimating a dynastic model of parental time and monetary inputs in early child-hood with endogenous fertility, home hours, labor supply, marriage, and divorce. It finds that the racial differences in the marriage matching patterns lead to racial differences in labor supply and home hours of couples. Although both the black-white labor market earnings and marriage market gaps are important sources of the black-white achievement gap, the assortative mating and divorce probabilities racial gaps accounts for a larger fraction of it.

We characterize how product market competition disciplines managers in a moral hazard setting. Co... more We characterize how product market competition disciplines managers in a moral hazard setting. Competition has two effects on a firm. First, the expected revenue or the marginal benefit of effort declines, leading to weakly lower effort. Second, the cost of inducing high effort increases (decreases) if competition increases (decreases) the probability of failure at a firm. Both effects imply a change in the optimal level of effort as competition increases. The manager in our model enjoys slack if he supplies low effort in equilibrium. We show that, if competition increases the probability of failure, managerial slack increases with competition. The relationship between managerial slack and firm value is ambiguous: Exogenous changes in the private benefit of low effort can affect slack without changing firm value, and vice versa. As a result, empirical tests that identify changes in slack may not capture the effect of competition on the level of slack. 1

This paper is an empirical study of the market for managers, more specifically the effects of age... more This paper is an empirical study of the market for managers, more specifically the effects of agency, human capital, and preferences on their promotion, tenure, turnover and compensation. From a large longitudinal data set compiled from observations on executives and their publicly listed firms, we construct a career hierarchy and report on its main features. Our summary results motivate a dynamic competitive equilibrium model, whose parameters we identify and estimate. Controlling for heterogeneity amongst firms, which differ by size and sector, and also managers, whose backgrounds vary by age, gender and education, our estimates are used to evaluate how important moral hazard and job experience are in jointly determining promotion rates, turnover and compensation.

This paper is an empirical study of the market for managers, more speci…cally the e¤ects of agenc... more This paper is an empirical study of the market for managers, more speci…cally the e¤ects of agency, human capital, and preferences on their promotion, tenure, turnover and compensation. From a large longitudinal data set compiled from observations on executives and their publicly listed …rms, we construct a career hierarchy and report on its main features. Our summary results motivate a dynamic competitive equilibrium model, whose parameters we identify and estimate. Controlling for heterogeneity amongst rms, which di¤er by size and sector, and also managers, whose backgrounds vary by age, gender and education, our estimates are used to evaluate how important moral hazard and job experience are in jointly determining promotion rates, turnover and compensation. 1

The black-white pay gap increases substantially over the life-cycle. We document that white worke... more The black-white pay gap increases substantially over the life-cycle. We document that white workers are assigned initially to occupations with higher complex task requirements. The accumulated earnings gap grows from 30Kafter5yearsto30K after 5 years to 30Kafter5yearsto143K after 15 years. The growth in the total earrings gap are large even for workers with the same education and AFQT scores. During these years, the gap in the degree of task complexity grows substantially. To understand the source of these long run pay gaps and to analyze their link to occupational sorting and experience, we develop a dynamic Roy model of employment and occupation choice and learning which nests discrimination and accounts for the dynamic selection of workers into occupations over time. We then develop a two-step estimation method to recover the model’s structural parameters, and use them to simulate counterfactual exercises that allows us to decompose the different factors affecting these gaps. About 27% of the total pay gap af...

This paper uses a dynastic model of household behavior to estimate and decomposed the correlation... more This paper uses a dynastic model of household behavior to estimate and decomposed the correlations in earnings across generations. The estimate model can explain 75% to 80% of the observed correlation in lifetime earnings between fathers and sons, mothers and daughters, and families across generations. The main results are that the family and division of labor within the household are the main source of the correlation across generation and not just assorting mating. The interaction of human capital accumulation in labor market, the nonlinear return to part-time versus full-time work, and the return parental time investment in children are the main driving force behind the intergenerational correlation in earnings and assortative mating just magnify these forces.

The Regional Economist, 2016

In this study, the gap is compared from one generation to the next. The changes in the wage gap a... more In this study, the gap is compared from one generation to the next. The changes in the wage gap are linked to changes in labor supply and to “statistical discrimination”—when women pay a price because many other women are less attached to the workforce than men are.

In this paper we developed and estimated a model of dynastic households in which altruistic indiv... more In this paper we developed and estimated a model of dynastic households in which altruistic individuals choose fertility, labor supply, and time investment in children sequentially, using data on two generations from the PSID. We then use the estimates to quantify the quality-quantity trade-offs and the return to parental time investment in children. We find that both fathers’and mothers’time investment increases children’s outcomes, however, the overall return to fathers’time investment is only 60% that of mothers’time investment. Despite the fact that the valuation function is higher for whites and the fact that conditional on education, blacks earn less than whites, on the margin, there are no significant race differences in the rate of returns to paternal time investment, and blacks have a higher return to maternal time investment than whites. Hence, the main reason for the lower parental time investment by blacks is the differences in family structure. There are a significantly...

RePEc: Research Papers in Economics, Mar 1, 2011

Fewer women than men become executive managers. They earn less over their careers, hold more juni... more Fewer women than men become executive managers. They earn less over their careers, hold more junior positions, and exit the occupation at a faster rate. We compiled a large panel data set on executives and formed a career hierarchy to analyze mobility and compensation rates. We …nd that, controlling for executive rank and background, women earn higher compensation than men, experience more income uncertainty, and are promoted more quickly. Amongst survivors, being female increases the chance of becoming CEO. Hence, the unconditional gender pay gap and job-rank di¤erences are primarily attributable to female executives exiting at higher rates than men in an occupation where survival is rewarded with promotion and higher compensation.

This paper analyzes the sources of the racial difference in the intergenerational transmission of... more This paper analyzes the sources of the racial difference in the intergenerational transmission of human capital by developing and estimating a dynastic model of parental time and monetary inputs in early childhood with endogenous fertility, home hours, labor supply, marriage, and divorce. It finds that the racial differences in the marriage matching patterns lead to racial differences in labor supply and home hours of couples. Although both the black-white labor market earnings and marriage market gaps are important sources of the black-white achievement gap, the assortative mating and divorce probabilities racial gaps accounts for a larger fraction of it.

Review, 2022

In this article, we document the empirical relationship among juvenile conviction, education, adu... more In this article, we document the empirical relationship among juvenile conviction, education, adult labor market occupational choices, employment, wages, and recidivism. Although several studies have shown that juvenile adjudication is associated with lower formal educational attainment and an increased likelihood of dropping out of high school, no existing study examines human capital accumulation through on-the-job (OTJ) training. Our data are from the National Longitudinal Survey of Youth 1997 (NLSY97) and the Occupational Information Network (O*NET). NLSY97 is a longitudinal survey that follows the lives of a sample of American youth born between 1980-84. It provides detailed information on each individual's convictions and incarcerations over time as well as the age and date of the first time the individual had an interaction with the correctional system. It also collects detailed information on each individual's history of employment, occupations, and wages. Finally, it has information on each This article documents the long-term relationship among juvenile conviction, occupational choices, employment, wages, and recidivism. Using data from the National Longitudinal Survey of Youth 1997 (NLSY97), we document that youth convicted at or before age 17 have a lower full-time employment rate and lower wage growth rate even after 10 years in the labor market. Merging the NLSY97 with occupational characteristics data from the Occupational Information Network (O*NET), we show that youth with a juvenile conviction are less likely to be employed in occupations that have a high on-the-job training requirement and that these occupations have higher wages and wage growth. Accumulated occupation-specific work experience, general experience, and education are important for explaining the gaps in wage and recidivism between youth with and without a juvenile conviction. Our results highlight the important role of occupational choices as a human capital investment vehicle through which juvenile crimes have a longterm impact on wages and recidivism. (JEL K42, I24, J2, J3)

The Review of Economic Studies, Sep 8, 2011

This paper investigates the role of labor-market attachment, on-thejob human-capital accumulation... more This paper investigates the role of labor-market attachment, on-thejob human-capital accumulation, occupational sorting, and discrimination in the narrowing gender earnings gap from 1968-93. This paper contributes in three ways: First, it formulates an estimable dynamic model of labor-supply, occupational sorting and human-capital accumulation in which gender discrimination and the earnings gap arise endogenously. Second, it demonstrates identi cation of such models and develops a three-step estimation technique. Third, it uses the framework to quantify the main driving forces behind the changes in labor-market gender patterns. Increase in overall productivity, demographic changes and statistical discrimination patterns account for a large percentage of the decline in the gender earnings gap and the increase in female labor market experience. Whereas, relative increase in productivity in professional occupations raise representation of women in professional occupations. Further analysis shows that labor-market frictions signi cantly amplify exogenous changes in our model. Without labor-market frictions, the earnings gap would have been smaller by at least 45%. Fewer women would have participated in the labor force, but those who participated would have worked more and earned incomes similar to those of men. We nd that there are signi cantly higher returns to professional occupations and that this has increased greatly over time, accounting for women's increasing representation in professional occupations.

The Regional Economist, 2016

The gender pay gap persists, even within occupations and even though women’s educational attainme... more The gender pay gap persists, even within occupations and even though women’s educational attainments are surpassing men’s. Is it because women tend to choose jobs with hours that are more irregular than those taken by men?

RePEc: Research Papers in Economics, 2008

This paper formulates and estimates a dynamic model of labor supply, occupational sorting, human ... more This paper formulates and estimates a dynamic model of labor supply, occupational sorting, human capital accumulation and discrimination to explain the narrowing gender earnings gap from 1968 to 1993. The paper proves the model is identi…ed and develops a three-step estimation technique. Imperfect information signi…cantly ampli…es exogenous shocks: statistical discrimination accounts for 36 percent of the observed gender earnings gap in the mid-to-late 1970s, declining to 22 percent in the mid-to-late 1980s. Di¤erences in preferences are comparatively less important: the gap would have been at least 56 percent smaller in the mid-to-late 1970s and would have nearly closed by the mid-to-late 1980s if it was driven only be preference. Increases in overall productivity and demographic changes account for a large percentage of the decline in the gender earnings gap and the increase in female labor market experience, while a relative increase in productivity raises women's representation in professional occupations.

Journal of Labor Economics, Oct 1, 2012

Fewer women than men become executive managers. They earn less, hold more junior positions, and a... more Fewer women than men become executive managers. They earn less, hold more junior positions, and attrit faster. We compiled a large panel data set on executives and formed a career hierarchy to analyze promotion and compensation rates. Given executive rank and background, women are paid more than men, experience less income uncertainty, and are promoted as quickly. Amongst survivors, being female increases the chance of becoming CEO. Hence the gender pay gap and job rank di¤erences are primarily attributable to female executives attriting at higher rates than males in an occupation where survival is rewarded with promotion and higher compensation.

University of Economics and Technology. The views expressed are those of the individual authors a... more University of Economics and Technology. The views expressed are those of the individual authors and do not necessarily reect o ¢ cial positions of the Federal Reserve Bank of St. Louis, the Federal Reserve System, or the Board of Governors. This paper explores the estimation of a class of life-cycle discrete choice intergenerational models. It proposes a new semiparametric estimator. It shows that it is p N-consistent and asymptotically normally distributed. We compare our estimator with a modi…ed version of the full solution maximum likelihood estimator (MLE) in a Monte Carlo study. Our estimator performs comparably to the MLE in a …nite sample but greatly reduces the computational cost. The paper documents that the quantity-quality trade-o¤s depend on the household composition and specialization in the household. Using the proposed estimator, we estimate a dynastic model that rationalizes these observed patterns. (JEL classi…cation: C13, J13, J22, J62) 1

Canadian Parliamentary Review, 2021

The labor force participation of women has increased substantially since the 1960s. At the same t... more The labor force participation of women has increased substantially since the 1960s. At the same time, the gender earnings gap has declined from about 40 percent in the late 1960s to less than 28 percent in the early 1990s and has stopped converging since.1 Much of the gender earnings gap is explained by gender differences in labor force attachment and accumulated labor market experience. In particular, the gender earnings gap increases with age as the experience gap increases.2 One explanation for the remaining gender earnings gap is that many jobs disproportionately reward working long hours.3 In many jobs, the pay is nonlinear in hours worked and penalizes workers who choose to work fewer hours. This reward structure tends to affect women of childbearing years disproportionately and also affects their occupational choices. Furthermore, in most occupations, the representation of women at the top-paying jobs is low—even if at lower levels there are many women.4 This article document...

SSRN Electronic Journal, 2015

This paper uses a dynastic model of household behavior to estimate and decomposed the correlation... more This paper uses a dynastic model of household behavior to estimate and decomposed the correlations in earnings across generations. The estimate model can explain 75% to 80% of the observed correlation in lifetime earnings between fathers and sons, mothers and daughters, and families across generations. The main results are that the family and division of labor within the household are the main source of the correlation across generation and not just assorting mating. The interaction of human capital accumulation in labor market, the nonlinear return to part-time versus full-time work, and the return parental time investment in children are the main driving force behind the intergenerational correlation in earnings and assortative mating just magnify these forces.

SSRN Electronic Journal, 2015

This paper explores the estimation of a class of life-cycle discrete choice intergenerational mod... more This paper explores the estimation of a class of life-cycle discrete choice intergenerational models. It proposes a new semiparametric estimator. It shows that it is p N-consistent and asymptotically normally distributed. We compare our estimator with a modi…ed version of the full solution maximum likelihood estimator (MLE) in a Monte Carlo study. Our estimator performs comparably to the MLE in a …nite sample but greatly reduces the computational cost. The paper documents that the quantity-quality trade-o¤s depend on the household composition and specialization in the household. Using the proposed estimator, we estimate a dynastic model that rationalizes these observed patterns.

This paper analyzes the sources of the racial difference in the intergenerational transmission of... more This paper analyzes the sources of the racial difference in the intergenerational transmission of human capital by developing and estimating a dynastic model of parental time and monetary inputs in early child-hood with endogenous fertility, home hours, labor supply, marriage, and divorce. It finds that the racial differences in the marriage matching patterns lead to racial differences in labor supply and home hours of couples. Although both the black-white labor market earnings and marriage market gaps are important sources of the black-white achievement gap, the assortative mating and divorce probabilities racial gaps accounts for a larger fraction of it.

We characterize how product market competition disciplines managers in a moral hazard setting. Co... more We characterize how product market competition disciplines managers in a moral hazard setting. Competition has two effects on a firm. First, the expected revenue or the marginal benefit of effort declines, leading to weakly lower effort. Second, the cost of inducing high effort increases (decreases) if competition increases (decreases) the probability of failure at a firm. Both effects imply a change in the optimal level of effort as competition increases. The manager in our model enjoys slack if he supplies low effort in equilibrium. We show that, if competition increases the probability of failure, managerial slack increases with competition. The relationship between managerial slack and firm value is ambiguous: Exogenous changes in the private benefit of low effort can affect slack without changing firm value, and vice versa. As a result, empirical tests that identify changes in slack may not capture the effect of competition on the level of slack. 1

This paper is an empirical study of the market for managers, more specifically the effects of age... more This paper is an empirical study of the market for managers, more specifically the effects of agency, human capital, and preferences on their promotion, tenure, turnover and compensation. From a large longitudinal data set compiled from observations on executives and their publicly listed firms, we construct a career hierarchy and report on its main features. Our summary results motivate a dynamic competitive equilibrium model, whose parameters we identify and estimate. Controlling for heterogeneity amongst firms, which differ by size and sector, and also managers, whose backgrounds vary by age, gender and education, our estimates are used to evaluate how important moral hazard and job experience are in jointly determining promotion rates, turnover and compensation.

This paper is an empirical study of the market for managers, more speci…cally the e¤ects of agenc... more This paper is an empirical study of the market for managers, more speci…cally the e¤ects of agency, human capital, and preferences on their promotion, tenure, turnover and compensation. From a large longitudinal data set compiled from observations on executives and their publicly listed …rms, we construct a career hierarchy and report on its main features. Our summary results motivate a dynamic competitive equilibrium model, whose parameters we identify and estimate. Controlling for heterogeneity amongst rms, which di¤er by size and sector, and also managers, whose backgrounds vary by age, gender and education, our estimates are used to evaluate how important moral hazard and job experience are in jointly determining promotion rates, turnover and compensation. 1

The black-white pay gap increases substantially over the life-cycle. We document that white worke... more The black-white pay gap increases substantially over the life-cycle. We document that white workers are assigned initially to occupations with higher complex task requirements. The accumulated earnings gap grows from 30Kafter5yearsto30K after 5 years to 30Kafter5yearsto143K after 15 years. The growth in the total earrings gap are large even for workers with the same education and AFQT scores. During these years, the gap in the degree of task complexity grows substantially. To understand the source of these long run pay gaps and to analyze their link to occupational sorting and experience, we develop a dynamic Roy model of employment and occupation choice and learning which nests discrimination and accounts for the dynamic selection of workers into occupations over time. We then develop a two-step estimation method to recover the model’s structural parameters, and use them to simulate counterfactual exercises that allows us to decompose the different factors affecting these gaps. About 27% of the total pay gap af...

This paper uses a dynastic model of household behavior to estimate and decomposed the correlation... more This paper uses a dynastic model of household behavior to estimate and decomposed the correlations in earnings across generations. The estimate model can explain 75% to 80% of the observed correlation in lifetime earnings between fathers and sons, mothers and daughters, and families across generations. The main results are that the family and division of labor within the household are the main source of the correlation across generation and not just assorting mating. The interaction of human capital accumulation in labor market, the nonlinear return to part-time versus full-time work, and the return parental time investment in children are the main driving force behind the intergenerational correlation in earnings and assortative mating just magnify these forces.

The Regional Economist, 2016

In this study, the gap is compared from one generation to the next. The changes in the wage gap a... more In this study, the gap is compared from one generation to the next. The changes in the wage gap are linked to changes in labor supply and to “statistical discrimination”—when women pay a price because many other women are less attached to the workforce than men are.

In this paper we developed and estimated a model of dynastic households in which altruistic indiv... more In this paper we developed and estimated a model of dynastic households in which altruistic individuals choose fertility, labor supply, and time investment in children sequentially, using data on two generations from the PSID. We then use the estimates to quantify the quality-quantity trade-offs and the return to parental time investment in children. We find that both fathers’and mothers’time investment increases children’s outcomes, however, the overall return to fathers’time investment is only 60% that of mothers’time investment. Despite the fact that the valuation function is higher for whites and the fact that conditional on education, blacks earn less than whites, on the margin, there are no significant race differences in the rate of returns to paternal time investment, and blacks have a higher return to maternal time investment than whites. Hence, the main reason for the lower parental time investment by blacks is the differences in family structure. There are a significantly...