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ALTONJI, JOSEPH G.
BHARADWAJ, PRASHANT
LANGE, FABIAN
Changes in the Characteristics of American Youth: Implications for Adult Outcomes
Working Paper No. 13883, National Bureau of Economic Research, March 2008. Also: http://www.nber.org/papers/w13883
Cohort(s): NLSY79, NLSY97
ID Number: 5777
Publisher: National Bureau of Economic Research -- NBER

Permission to reprint the abstract has not been received from the publisher.

We examine changes in the characteristics of American youth between the late 1970s and the late 1990s, with a focus on characteristics that matter for labor market success. We reweight the NLSY79 to look like the NLSY97 along a number of dimensions that are related to labor market success, including race, gender, parental background, education, test scores, and variables that capture whether individuals transition smoothly from school to work. We then use the re-weighted sample to examine how changes in the distribution of observable skills affect employment and wages. We also use more standard regression methods to assess the labor market consequences of differences between the two cohorts. Overall, we find that the current generation is more skilled than the previous one. Blacks and Hispanics have gained relative to whites and women have gained relative to men. However, skill differences within groups have increased considerably and in aggregate the skill distribution has widened. Changes in parental education seem to generate many of the observed changes

ALTONJI, JOSEPH G.
BHARADWAJ, PRASHANT
LANGE, FABIAN
Changes in the Characteristics of American Youth: Implications for Adult Outcomes
Presented: Washington, D.C., Bureau of Labor Statistics Conference Center, NLSY97 Tenth Anniversary Conference, May 29 & 30, 2008. Also: http://harrisschool.uchicago.edu/Research/conferences/NLSYConf/pdf/altonji.pdf
Cohort(s): NLSY79
ID Number: 5893
Publisher: U.S. Department of Labor

We examine changes in the characteristics of American youth between the late 1970s and the late 1990s, with a focus on characteristics that matter for labor market success. We reweight the NLSY79 to look like the NLSY97 along a number of dimensions that are related to labor market success, including race, gender, parental background, education, test scores, and variables that capture whether individuals transition smoothly from school to work. We then use the re-weighted sample to examine how changes in the distribution of observable skills affect employment and wages. We also use more standard regression methods to assess the labor market consequences of differences between the two cohorts. Overall, we find that the current generation is more skilled than the previous one. Blacks and Hispanics have gained relative to whites and women have gained relative to men. However, skill differences within groups have increased considerably and in aggregate the skill distribution has widened. Changes in parental education seem to generate many of the observed changes

ALTONJI, JOSEPH G.
CATTAN, PETER
WARE, IAIN
Identifying Sibling Influences on Teenage Risky Behavior
Presented: Washington, D.C., Bureau of Labor Statistics Conference Center, NLSY97 Tenth Anniversary Conference, May 29 & 30, 2008
Cohort(s): NLSY97
ID Number: 5910
Publisher: U.S. Department of Labor

Permission to reprint the abstract has not been received from the publisher.



ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
An Intergenerational Model of Earnings, Hours and Wages
Working Paper, Center for Urban Affairs and Policy Research, Northwestern University, 1990
Cohort(s): Mature Women, Older Men, Young Men, Young Women
ID Number: 34
Publisher: Center for Urban Affairs and Policy Research, Northwestern University

Permission to reprint the abstract has not been received from the publisher.

In this paper, the authors measure the extent to which the parental and family characteristics that drive wage rates and work hours independently of wage rates are responsible for similarities among family members in labor market outcomes. A factor model is developed for the earnings, hours and wages of young men and young women which then dictates the linkages among the covariances of these variables and those of their parents and their siblings. In the model, a young man's or woman's wage depends on the permanent component of father's wage, the permanent component of mother's wage, a sibling component which captures background characteristics that are common to siblings and are independent of the parents, and an idiosyncratic component. The young man's annual hours depend on his wages and his preferences which are composed of four independent elements--his father's preference factor, his mother's preference factor, and sibling and idiosyncratic factors. Lastly, his earnings are determined by his wages and his hours choice. The authors fit the model using auto- and covariances of earnings, hours and wages estimated from data on matched sibling and parent-child pairs from the NLS. The results indicate that the wages of young men and young women are quite responsive to the wage components of their fathers and mothers, and that there are important family links among the labor supply preferences as well. It was also found that wages play a small role in labor supply determination for young men, young women, and older men, and a larger role for mature women. Detailed decompositions of the variance of earnings, hours, and wages are provided.

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
An Intergenerational Model of Wages, Hours and Earnings
Working Paper No. 4950, National Bureau of Economic Research, December 1994. Also: http://nber.nber.org/papers/W4950.pdf
Cohort(s): NLSY79
ID Number: 2823
Publisher: National Bureau of Economic Research -- NBER

Permission to reprint the abstract has not been received from the publisher.

In this paper we develop and estimate a factor model of the earnings, labor supply, and wages of young men and women, their parents and their siblings. We estimate the model using data on matched sibling and parent-child pairs from the National Longitudinal Survey of Labor Market Experience. We measure the extent to which a set of unobserved parental and family factors that drive wage rates and work hours independently of wage rates lead to similarities among family members in labor market outcomes. We find strong family similarities in work hours that run along gender lines. These labor supply responses to family similarities in wages. The wage factors of the father and mother influence the wages of both sons and daughters. A "sibling" wage factor also plays an important role in wage determination. We find that intergenerational correlations in wages substantially overestimate the direct influence of fathers, and especially mothers, on wages. This is because the father's and mother's wage factors are positively correlated. The relative importance for the variance in earnings of the direct effect of wages, the labor supply response induced by wages, and effect of hours preferences varies by gender, and by age in the case of women. For all groups most of the effect of wages on earnings is direct rather than through a labor supply response. (COPYRIGHT: This record is part of the Abstracts of Working Papers in Economics (AWPE) Database, copyright (c) 1995 Cambridge University Press) Full-text available on-line: http://nberws.nber.org/papers/W4950.pdf

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
An Intergenerational Model of Wages, Hours, and Earnings
Journal of Human Resources 35,2 (Spring 2000): 221-258
Cohort(s): Mature Women, Older Men, Young Men, Young Women
ID Number: 3546
Publisher: University of Wisconsin Press

We develop a model in which a set of unobserved parental and sibling factors drives wages and work preferences. These factors lead to similarities within families in wages, work hours, and earnings. We estimate the model using data on parents and siblings in the National Longitudinal Surveys. We find that parental and sibling wage factors influence the wages of both sons and daughters. We also find strong similarities in work hours that run along gender lines and are due primarily to linkages in preferences. The effect of wages on earnings is direct rather than through a labor supply response.

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
Effects of Family Characteristics on the Return to Education
Review of Economics and Statistics 78,4 (November 1996): 692-704
Cohort(s): Young Men, Young Women
ID Number: 2693
Publisher: Harvard University Press

Permission to reprint the abstract has not been received from the publisher.

The role of parental education in the human capital production function is examined by estimating the effects of parental education on the education profile of wages. The analysis uses sibling pairs from the Panel Study of Income Dynamics and the National Longitudinal Surveys of Labor Market Experience of Young Men and Young Women. Mixed evidence on whether parental education raises the return to education is obtained. (ABI/Inform)

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
Effects of Parental Characteristics on the Returns to Education and Labor Market Experience
Working Paper, Center for Urban Affairs and Policy Research, Northwestern University, 1990
Cohort(s): Young Men, Young Women
ID Number: 31
Publisher: Center for Urban Affairs and Policy Research, Northwestern University

Permission to reprint the abstract has not been received from the publisher.

Many studies have found strong influences of parental characteristics and family on the educational attainment of children. Few, however, have looked at the influence of these factors on the rate of return to education or rate of return to experience. The authors measure the extent to which the education profile of wages and the experience profile of wages are influenced by the child's IQ, parents' educations, and the index of family background variables, school characteristics, and personal characteristics that predict years of schooling completed. The presence of sibling pairs in the NLS is exploited in estimating the effects of parental characteristics and background variables on the education slope of wages and the experience slope of wages. The authors use ordinary least squares regression procedures and include a family fixed effect to capture omitted family variables that might otherwise bias the slope estimates. It was found that the child's IQ, parents' educations, and the index of personal, family and school characteristics that predict the child's educational attainment have only a weak influence on the relationships between education and wages and labor market experience and wages. It seems unlikely that the effect of family background on the education slope of wages is responsible for more than a small fraction of the powerful effect of family background on the years of schooling completed.

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
Effects of School and Family Characteristics on the Return to Education
Working Paper No. 5072, National Bureau of Economic Research, March 1995. Also: http://nber.nber.org/papers/W5072.pdf
Cohort(s): Young Men, Young Women
ID Number: 32
Publisher: National Bureau of Economic Research -- NBER

We measure the effects of parental education on the education profile of wages. The analysis uses sibling pairs from the Panel Study of Income Dynamics and the National Longitudinal Surveys of Labor Market Experience of Young Men and Young Women. We also use the variance across siblings in school characteristics to estimate the effects of school inputs on wages holding family background constant. We obtained mixed evidence on whether parental education raises the return to education. We find that teacher's salary, expenditures per pupil, and a composite index of school quality measures have a substantial positive effect on the wages of high school graduates. Full-text available on-line: http://nber.nber.org/papers/W5072.pdf

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
Family Background and Labor Market Outcomes
NLS Discussion Paper No. 92-13. Washington DC: U.S. Bureau of Labor Statistics, June 1990. Also: Final Report, U.S. Department of Labor, Bureau of Labor Statistics, 1990. Also: http://stats.bls.gov/ore/abstract/nl/nl900030.htm
Cohort(s): Mature Women, Older Men, Young Men, Young Women
ID Number: 33
Publisher: U.S. Department of Labor

This report is a compilation of the following three papers abstracted elsewhere in this bibliography: (1) "Relationships Among the Family Incomes and Labor Market Outcomes of Relatives"; (2) "An Intergenerational Model of Wages, Hours and Earnings"; and (3) "Effects of Parental Characteristics on the Returns to Education and Labor Market Experience."

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
Relationships Among the Family Incomes and Labor Market Outcomes of Relatives
Research in Labor Economics 12 (1991): 269-310
Cohort(s): Mature Women, Older Men, Young Men, Young Women
ID Number: 35
Publisher: JAI Press, Inc.

This paper examines the links between the labor market outcomes of individuals who are related by blood or by marriage using panel data on pairs of matched family members from the NLS. The authors examine the intergenerational and sibling correlations among a broad set of labor market variables using time average, method of moments, and regression techniques designed to reduce the biases introduced by transitory and measurement errors. They also show that family data can be exploited to investigate theories of job turnover, labor supply, and the industry structure of wages. The primary findings follow. First, there are strong correlations between the family incomes of relatives. The method of moments estimates are .38 for brother pairs, .73 for sister pairs, and .56 for brother-sister pairs. The intergenerational family income correlations are .36 for father-son pairs, .48 for father-daughter pair, and .56 for mother-daughter and mother-son pairs. These estimates, except for the father-son result, are large compared to those in the literature for the U.S. Second, strong correlations were found in the wages and earnings of relatives. Wage correlations vary around .40 for all family member pairs, and earnings correlations vary around .35. Work hours of family members of the same sex are also fairly strongly related. Fourth, strong correlations were found in the earnings of "in-laws" that may support a theory of assortive mating in which parental earnings have value. Also provided was evidence that job turnover rates depend on family characteristics and are negatively correlated with labor market productivity. Further, it was shown that young men whose fathers work in high wage industries tend themselves to work in high wage industries and that a father's collective bargaining coverage has a strong positive influence on his son's collective bargaining status.

ALTONJI, JOSEPH G.
DUNN, THOMAS ALBERT
Using Siblings To Estimate The Effect Of School Quality On Wages
Review of Economics and Statistics 78,4 (November 1996): 665-671
Cohort(s): Young Men, Young Women
ID Number: 2694
Publisher: Harvard University Press

Permission to reprint the abstract has not been received from the publisher.

The variance across siblings in school characteristics is used to estimate the effects of school inputs on wages. The analysis uses sibling pairs from the National Longitudinal Surveys of Labor Market Experience of Young Men and Young Women. It is found that teachers' salary, expenditures per pupil, and a composite index of school quality indicators have a substantial positive effect on the wages of high school graduates. (ABI/Inform)

ALTONJI, JOSEPH G.
PIERRET, CHARLES R.
Employer Learning and the Signaling Value of Education
NLS Discussion Paper No. 97-35. Washington DC: U.S. Bureau of Labor Statistics, November 1997. Also: http://stats.bls.gov/ore/abstract/nl/nl970030.htm
Cohort(s): NLSY79
ID Number: 3042
Publisher: U.S. Department of Labor

If profit maximizing firms have limited information about the general productivity of new workers, they may choose to use easily observable characteristics such as years of education to "statistically discriminate" among workers. The pure credential value of education will depend on how quickly firms learn. To obtain information on employer learning, we work with a wage equation that contains both the interaction between experience and a hard to observe variable that is positively related to productivity and the interaction between experience and a variable that firms can easily observe, such as years of education. The time path of the coefficient on the unobservable productivity variable provides information about the rate at which employers learn about worker productivity. Using data from the NLSY we obtain preliminary estimates of the rate at which employers learn about worker quality and use these, along with some strong auxiliary assumptions, to explore the empirical relevance of the educational screening hypothesis. We show that even if employers learn relatively slowly about the productivity of new workers, the portion of the return to education that could reflect signaling of ability is limited.

ALTONJI, JOSEPH G.
PIERRET, CHARLES R.
Employer Learning and Statistical Discrimination
NLS Discussion Paper No. 97-36. Washington DC: U.S. Bureau of Labor Statistics, November 1997. Also: http://stats.bls.gov/ore/abstract/nl/nl970020.htm
Cohort(s): NLSY79
ID Number: 3043
Publisher: U.S. Department of Labor

We provide a test for statistical discrimination or "rational" stereotyping in environments in which agents learn over time. Our application is to the labor market. If profit maximizing firms have limited information about the general productivity of new workers, they may choose to use easily observable characteristics such as years of education to "statistically discriminate" among workers. As firms acquire more information about a worker, pay will become more dependent on actual productivity and less dependent on easily observable characteristics or credentials that predict productivity. Consider a wage equation that contains both the interaction between experience and a hard to observe variable that is positively related to productivity and the interaction between experience and a variable that firms can easily observe, such as years of education. We show that the wage coefficient on the unobservable productivity variable should rise with time in the labor market and the wage coefficient on education should fall. We investigate this proposition using panel data on education, the AFQT test, father's education, and wages for young men and their siblings from NLSY. We also examine the empirical implications of statistical discrimination on the basis of race. Our results support the hypothesis of statistical discrimination, although they are inconsistent with the hypothesis that firms fully utilize the information in race. Our analysis has wide implications for the analysis of the determinants of wage growth and productivity and the analysis of statistical discrimination in the labor market and elsewhere.

ALTONJI, JOSEPH G.
PIERRET, CHARLES R.
Employer Learning and Statistical Discrimination
Quarterly Journal of Economics 116,1 (February 2001): 313-350
Cohort(s): NLSY79
ID Number: 4769
Publisher: MIT Press

Permission to reprint the abstract has not been received from the publisher.

We show that if firms statistically discriminate among young workers on the basis of easily observable characteristics such as education, then as firms learn about productivity, the coefficients on the easily observed variables should fall, and the coefficients on hard-to-observe correlates of productivity should rise. We find support for this proposition using NLSY79 data on education, the AFQT test, father's education, and wages for young men and their siblings. We find little evidence for statistical discrimination in wages on the basis of race. Our analysis has a wide range of applications in the labor market and elsewhere. See also: http://mitpress.mit.edu/catalog/item/default.asp?sid=3D348EF6-21E0-4F3D-BC20-894E50FBE564&ttype=6&tid=567


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