IDEAS home Printed from https://ideas.repec.org/a/bla/revinw/v22y1976i1p61-74.html
   My bibliography  Save this article

Ability And Age‐Income Profiles

Author

Listed:
  • JOOP HARTOG

Abstract

This paper is devoted to the personal distribution of income. The focus is on the relation between individual age and income and on the observed regularities in these age‐income profiles. Empirically, age‐income profiles show marked differences by occupation and by education. In general, with increasing levels of education both the level and the slope of the age‐income profile increase; there is also a tendency of the variance of income to increase with age. Explanations of these facts are discussed. The human capital model is found defective in two ways: direct measurement of capital formation that occurs through on‐the‐job training is not feasible and the demand side of the labor market is ignored. Lydall's approach stressing the role of ability development is considered promising, yet lacking a theoretic integration of the relevant factors. The relation between education and ability is also reviewed. It is concluded that IQ is an important variable associated with educational attainment, but that its explanatory power with respect to earnings in addition to length of schooling is almost negligible. Moreover, its development over age cannot be held responsible for the age‐income profile, since its peak is far too early. Ability as a multidimensional concept appears attractive, though empirical problems are manifold. Finally, interesting direct empirical evidence on productivity development with experience is found in the literature on the learning curve. In certain jobs, where productivity can be measured directly, increasing experience on the job produces an asymptotic productivity profile. In the final section the conclusions are reviewed and used to briefly indicate a new theory. According to this theory, capabilities are the key variables in the labor market. Individual preferences regarding employment of these capabilities guide decisions about job choice. The labor market rewards capabilities and capability development over age explains the age‐income profile.

Suggested Citation

  • Joop Hartog, 1976. "Ability And Age‐Income Profiles," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 22(1), pages 61-74, March.
    • Handle: RePEc:bla:revinw:v:22:y:1976:i:1:p:61-74
    DOI: j.1475-4991.1976.tb01142.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1475-4991.1976.tb01142.x
    Download Restriction: no
    File URL: https://libkey.io/j.1475-4991.1976.tb01142.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Hause, John C, 1972. "Earnings Profile: Ability and Schooling," Journal of Political Economy, University of Chicago Press, vol. 80(3), pages 108-138, Part II, .
    2. de Wolff, P. & van Slijpe, A. R. D., 1973. "The relation between income, intelligence, education and social background," European Economic Review, Elsevier, vol. 4(3), pages 235-264, October.
    3. Paul Taubman & Terence Wales, 1972. "Mental Ability and Higher Educational Attainment in the 20th Century," NBER Books, National Bureau of Economic Research, Inc, number taub72-1, January.
    4. Jacob Mincer, 1962. "On-the-Job Training: Costs, Returns, and Some Implications," NBER Chapters, in: Investment in Human Beings, pages 50-79, National Bureau of Economic Research, Inc.
    5. R. S. Eckaus, 1963. "Investment in Human Capital: A Comment," Journal of Political Economy, University of Chicago Press, vol. 71(5), pages 501-501.
    6. Kiker, B F & Liles, W Pierce, 1974. "Earnings, Employment, and Racial Discrimination: Additional Evidence," American Economic Review, American Economic Association, vol. 64(3), pages 492-501, June.
    7. Gintis, Herbert, 1971. "Education, Technology, and the Characteristics of Worker Productivity," American Economic Review, American Economic Association, vol. 61(2), pages 266-279, May.
    8. Bowles, Samuel & Nelson, Valerie I, 1974. "The "Inheritance of IQ" and the Intergenerational Reproduction of Economic Inequality," The Review of Economics and Statistics, MIT Press, vol. 56(1), pages 39-51, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Philippe Cazenave, 1976. "Pour une nouvelle analyse économique de la demande de formation," Revue Économique, Programme National Persée, vol. 27(1), pages 54-84.
    2. Jacob Mincer, 1974. "Progress in Human Capital Analysis of the Distribution of Earnings," NBER Working Papers 0053, National Bureau of Economic Research, Inc.
    3. B. Wolfe & S. Zuvekas, "undated". "Nonmarket outcomes of schooling," Institute for Research on Poverty Discussion Papers 1065-95, University of Wisconsin Institute for Research on Poverty.
    4. Andrén, Daniela & Palmer, Edward, 2001. "The Effect Of Sickness On Earnings," Working Papers in Economics 45, University of Gothenburg, Department of Economics.
    5. Edward N. Wolff & Dennis M. Bushe, 1976. "Age, Education and Occupational Earnings Inequality," NBER Working Papers 0149, National Bureau of Economic Research, Inc.
    6. Byoung Uk Kang & Jin-Mo Kim & Oded Palmon & Zhaodong Zhong, 2020. "Are college education and job experience complements or substitutes? Evidence from hedge fund portfolio performance," Review of Quantitative Finance and Accounting, Springer, vol. 54(4), pages 1247-1278, May.
    7. Sieben, I.J.P., 2005. "Does training trigger turnover...or not? : the impact of formal training on young men's and women's job search behaviour," ROA Research Memorandum 6E, Maastricht University, Research Centre for Education and the Labour Market (ROA).
    8. Maria Klonowska-Matynia, 2022. "Human Capital as a Source of Energy for Rural Areas’ Socio-Economic Development—Empirical Evidence for Rural Areas in Poland," Energies, MDPI, vol. 15(21), pages 1-31, November.
    9. Siemiński, Paweł & Hadyński, Jakub & Poczta, Walenty, 2020. "Diversification Of Human Capital Resources In Rural And Urban Areas In Poland," Roczniki (Annals), Polish Association of Agricultural Economists and Agribusiness - Stowarzyszenie Ekonomistow Rolnictwa e Agrobiznesu (SERiA), vol. 2020(1).
    10. Parent, Daniel, 1999. "Wages and Mobility: The Impact of Employer-Provided Training," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 298-317, April.
    11. Adrian Adermon & Mikael Lindahl & Daniel Waldenström, 2018. "Intergenerational Wealth Mobility and the Role of Inheritance: Evidence from Multiple Generations," Economic Journal, Royal Economic Society, vol. 128(612), pages 482-513, July.
    12. Rachid Boumahdi & Jean-Michel Plassard, 1992. "Note à propos du caractère endogène de la variable éducation dans la fonction de gains," Revue Économique, Programme National Persée, vol. 43(1), pages 145-156.
    13. Hui, Taylor Shek-wai, 2004. "The “Sheepskin Effects” of Canadian Credentials," MPRA Paper 17994, University Library of Munich, Germany.
    14. Maciej Jagódka & Małgorzata Snarska, 2021. "The State of Human Capital and Innovativeness of Polish Voivodships in 2004–2018," Sustainability, MDPI, vol. 13(22), pages 1-20, November.
    15. O'Connell, Michael, 2019. "Is the impact of SES on educational performance overestimated? Evidence from the PISA survey," Intelligence, Elsevier, vol. 75(C), pages 41-47.
    16. Petrongolo, Barbara & San Segundo, Maria J., 2002. "Staying-on at school at 16: the impact of labor market conditions in Spain," Economics of Education Review, Elsevier, vol. 21(4), pages 353-365, August.
    17. Edmundo Murrugarra & Martín Valdivia, 2000. "Morbilidad autoreportada y los retornos a la salud para los varones urbanos en el Perú: enfermedad vs. Incapacidad," Otras investigaciones, Consorcio de Investigación Económica y Social.
    18. Bergemann, Annette & Mertens, Antje, 2004. "Job Stability Trends, Layoffs, and Transitions to Unemployment: An Empirical Analysis for West Germany," IZA Discussion Papers 1368, Institute of Labor Economics (IZA).
    19. Mark C. Berger & John S. Earle & Klara Sabirianova, 2001. "Worker Training in a Restructuring Economy: Evidence from the Russian Transition," Book chapters authored by Upjohn Institute researchers, in: Soloman W. Polachek (ed.),Worker Wellbeing in a Changing Labor Market, pages 159-189, W.E. Upjohn Institute for Employment Research.
    20. Mengistae, Taye, 1999. "The relative effects of skill formation and job matching on wage growth in Ethiopia," Policy Research Working Paper Series 2104, The World Bank.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:revinw:v:22:y:1976:i:1:p:61-74. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley-Blackwell Digital Licensing or Christopher F. Baum (email available below). General contact details of provider: https://edirc.repec.org/data/iariwea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.