SHOULD I STAY OR SHOULD I GO? CAREER CHOICES FOR YOUNG WORKERS IN LATIN AMERICA |
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| Authors: | Graciana Rucci Fernando Saltiel Sergio Urzúa |
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| Institution: | 1. Inter-American Development Bank, Washington, DC, 20577;2. Department of Economics, Duke University, Durham, NC, 27705;3. Department of Economics, University of Maryland, College Park, MD, 20742 |
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| Abstract: | This paper presents the first estimates of the returns to formal labor market experience and tenure in a developing country context. We take advantage of rich matched employer–employee data from Brazil and Chile, exploiting job displacement as a source of identification. We find positive returns to both dimensions in these countries, with larger returns to tenure in Brazil and larger returns to experience in Chile. Our findings suggest the more rigid Brazilian labor legislation may encourage firms to invest in young workers' specific skills. Chile's institutions, on the contrary, might promote the acquisition of general skills. (JEL J24, J31, M50) |
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