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Author: Li, Yi
Resulting in 1 citation.
1. Li, Yi
Essays on Human Capital
Ph.D. Dissertation, Department of Economics, University of Wisconsin-Madison, 2015
Cohort(s): NLSY79, NLSY97
Publisher: ProQuest Dissertations & Theses (PQDT)
Keyword(s): College Enrollment; Life Cycle Research; Mobility, Occupational; Occupational Choice; Skill Formation; Socioeconomic Status (SES); Transfers, Parental; Wage Growth

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

This thesis consists of three papers. The first paper develops and structurally estimates a life cycle model of optimal college investment with risk in degree completion and labor earnings. I argue that low income children's stronger precautionary saving motive, which is due to their parents' inferior capacity to insure them against college investment risk, impedes their college attendance. I construct a dynamic non-cooperative game to examine two generations' incentive problems and endogenize parental transfers. My empirical analyses based on the NLSY97 highlight the importance of sequential parental transfers over children's life cycle. One main conclusion from my counterfactual experiments is that incorporating risk mitigation elements into student loan repayment scheme can significantly promote college enrollment.

The second paper builds a discrete occupational choice model that generalizes the static self-selection model with learning-by-doing. The model emphasizes the interaction between two general skills during the on-the-job skill accumulation processes. Workers' motivation for exploiting this interaction in order to accelerate skill accumulation generates occupational mobility. My estimation results based on the NLSY79 indicate that the model can replicate the empirical patterns of occupational mobility, wage growth, and wage dispersion. Of particular note is the model's capability to replicate a novel finding that a majority of workers congregate into occupations requiring relatively balanced skills as they age. Furthermore, the counterfactual experiment results suggest that increasing the cross-occupational moving costs would significantly slow down skill accumulation and reduce lifetime earnings.

Bibliography Citation
Li, Yi. Essays on Human Capital. Ph.D. Dissertation, Department of Economics, University of Wisconsin-Madison, 2015.