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Changes in occupational demand structure and their impact on individual wages

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  • Fedorets, Alexandra

Abstract

This paper estimates wage losses arising due to changes in the structure of demand for occupations. The data on occupational changes made for the sake of adjustment to the changes in the demand structure come from the German reunification of 1990. Endogenous occupational changes are instrumented by the post-reunification demand properties of the occupation of the apprenticeship completed in the GDR. The IV computation reveals a negative wage effect of nearly 35 log points in 1991/92. This effect is persistent over time: after almost 10 years after reunification the negative wage effect associated with occupational changes due to the relocation of individual human capital across occupations is more than 20 log points.

Suggested Citation

  • Fedorets, Alexandra, 2011. "Changes in occupational demand structure and their impact on individual wages," SFB 649 Discussion Papers 2011-075, Humboldt University Berlin, Collaborative Research Center 649: Economic Risk.
    • Handle: RePEc:zbw:sfb649:sfb649dp2011-075
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    5. Cheridito, Patrick & Horst, Ulrich & Kupper, Michael & Pirvu, Traian A., 2011. "Equilibrium pricing in incomplete markets under translation invariant preferences," SFB 649 Discussion Papers 2011-083, Humboldt University Berlin, Collaborative Research Center 649: Economic Risk.
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    10. Myšičková, Alena & Song, Song & Majer, Piotr & Mohr, Peter N. C. & Heekeren, Hauke R. & Härdle, Wolfgang Karl, 2011. "Risk patterns and correlated brain activities: Multidimensional statistical analysis of fMRI data with application to risk patterns," SFB 649 Discussion Papers 2011-085, Humboldt University Berlin, Collaborative Research Center 649: Economic Risk.

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    More about this item

    Keywords

    human capital; wage premium; occupational change; natural experiment;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • P21 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Planning, Coordination, and Reform

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