Experience and schooling : substitutes or complements?

Abstract

Abstract: This paper investigates whether returns to experience and seniority vary between workers with different levels of education and between different types of firms. Using a large administrative dataset for Norwegian manufacturing, I find that more educated workers have higher experience and seniority premiums, indicating that they accumulate more human capital (both general and firm-specific) than workers with less education. Firm characteristics are also found to be important for experience and seniority premiums. Indicators of technological change seem to be more important for returns to experience and seniority than indicators of technological level. The results suggest that workers learn from their colleagues, and that they learn the skills that their colleagues possess. Keywords: Wages, experience, seniority, firm and worker characteristics,linked employer-employee data.