Experience, tenure, and the perceptions of employers
Document Type
Article
Publication Date
1-1-2001
Abstract
This paper examines how group-based assessments concerning employee ability impact employee compensation. The employer learns about worker ability through Bayesian updating, creating an additional channel for wage growth that is not available to those workers with only general labor market experience. Consistent with the model's predictions, results from National Longitudinal Survey of Youth (NLSY) indicate that black workers fare much better relative to white workers in returns to tenure than in returns to experience. Finally, parameter estimates in the structural model suggest that employers initially undervalue black males but that their wages rise with learning by employers over time.
Publication Source (Journal or Book title)
Southern Economic Journal
First Page
578
Last Page
597
Recommended Citation
Lewis, D., & Terrell, D. (2001). Experience, tenure, and the perceptions of employers. Southern Economic Journal, 67 (3), 578-597. https://doi.org/10.2307/1061452