Abstract
We document for 13 countries ranging from rich (Canada, United States) to poor (India, Indonesia) that average wages are considerably lower in agriculture than in the other sectors. Moreover, agriculture has less educated workers and lower Mincer returns. We view these findings through the lens of a multi-sector model in which workers differ in observed and unobserved characteristics and sectors differ in their human-capital intensities. We derive expressions for the implied barriers to the reallocation of labor out of agriculture. We find that in our sample these barriers are considerably smaller than what the macro-development literature has argued.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 1-23 |
| Number of pages | 23 |
| Journal | American Economic Journal: Macroeconomics |
| Volume | 10 |
| Issue number | 2 |
| DOIs | |
| State | Published - Apr 1 2018 |
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ASJC Scopus subject areas
- Economics, Econometrics and Finance(all)
Cite this
Wages, human capital, and barriers to structural transformation. / Herrendorf, Berthold; Schoellman, Todd.
In: American Economic Journal: Macroeconomics, Vol. 10, No. 2, 01.04.2018, p. 1-23.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Wages, human capital, and barriers to structural transformation
AU - Herrendorf, Berthold
AU - Schoellman, Todd
PY - 2018/4/1
Y1 - 2018/4/1
N2 - We document for 13 countries ranging from rich (Canada, United States) to poor (India, Indonesia) that average wages are considerably lower in agriculture than in the other sectors. Moreover, agriculture has less educated workers and lower Mincer returns. We view these findings through the lens of a multi-sector model in which workers differ in observed and unobserved characteristics and sectors differ in their human-capital intensities. We derive expressions for the implied barriers to the reallocation of labor out of agriculture. We find that in our sample these barriers are considerably smaller than what the macro-development literature has argued.
AB - We document for 13 countries ranging from rich (Canada, United States) to poor (India, Indonesia) that average wages are considerably lower in agriculture than in the other sectors. Moreover, agriculture has less educated workers and lower Mincer returns. We view these findings through the lens of a multi-sector model in which workers differ in observed and unobserved characteristics and sectors differ in their human-capital intensities. We derive expressions for the implied barriers to the reallocation of labor out of agriculture. We find that in our sample these barriers are considerably smaller than what the macro-development literature has argued.
UR - http://www.scopus.com/inward/record.url?scp=85044769222&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85044769222&partnerID=8YFLogxK
U2 - 10.1257/mac.20160236
DO - 10.1257/mac.20160236
M3 - Article
VL - 10
SP - 1
EP - 23
JO - American Economic Journal: Macroeconomics
JF - American Economic Journal: Macroeconomics
SN - 1945-7707
IS - 2
ER -