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This paper aims to investigate whether the conventional approach to estimating the private and social rates of return to education generates reliable findings when used in economies with chronically depressed labour markets.

Conventional techniques (the Mincer earnings function and the discounting method) are used to provide initial estimates of the private and social returns to education in Kosovo. However, this study argues that in countries with chronically depressed labour markets, such as in Kosovo, the conventional approach is likely to significantly underestimate the private and social returns from achieving a higher level of educational attainment. This study extends the estimation approach to take into account the greater probability of more highly educated Kosovars being: employed, employed in the formal and public sectors and having longer job tenure.

The extended approach to estimating rates of return to schooling generates higher private and social rates of return to education than the conventional approach. Moreover, in contrast to the findings of the conventional approach, the revised approach suggests that private and social rates of return are highest from completion of upper secondary and tertiary education.

The results indicate that if governments in economies with chronically depressed labour markets decide upon their educational priorities based on unadjusted rates of return, then resources may be misallocated.

The analysis presented in this paper suggests that conventional approaches to estimating private and social rates of return to education are not suitable for use in economies with chronically depressed labour markets. In addition, the paper provides the first comprehensive analysis of the rates of return to education in Kosovo. These results are used to provide a critique of the Kosovo Government’s recent educational priorities.

Teixeira devotes the first chapter of his book to a modest-sized personal portrait of Mincer and overview of his professional career. Some of this material is largely of personal interest, although only the most stoic would fail to be moved. Mincer was born into a Jewish family in Poland in 1922. He excelled as a high school student and was in his first year of university studies in Czechoslovakia (chosen largely because other universities rejected him due to his religious background) when Hitler and the Nazis took over the country. Mincer spent three years in German concentration camps and miraculously survived, although his family in Poland was much less fortunate.

Shows the results of a new model for calculating private rates of return to education. The so‐called “cost‐benefit‐model” takes into account the influence of the existing wage structure, institutional factors as the cost of education and the fiscal system and risk premiums for dropping out of school as well as differences in unemployment. The model produces results that are relatively easy to interpret at the economic policy level and can easily be used to simulate the effects of changing parameters. The first empirical results for Switzerland indicate that once educational costs have been deducted, wage‐earning advantages for different educational groups are insignificant. The empirical results speak against the political demand – at least in Switzerland – that those who directly benefit from education should pay more towards its costs.

The purpose of this paper is to analyse the main evolutions and the current situation of the 50‐74 year olds on the labour market in eight European countries (Denmark France, Germany, Italy, The Netherlands, Sweden, Poland and the UK).

Based on a cross‐country comparative approach, this overview draws on detailed analysis of the situation of older workers and public policies in each of the selected countries but also on a wide range of available studies and statistics on employment and welfare outcomes.

The eight selected countries display similarities: a u‐shaped pattern of employment rates of older workers (55‐64 years old) over the last 40 years, with an increase since the mid 1990s, the later exit of higher educated workers and the higher prevalence of non‐standard employment contracts among older workers. On the other hand, considerable disparities can be observed regarding the gender gap in employment rate, current employment rates, self‐employment and part‐time employment among older workers.

Specific questions will be more acute with the effective postponement of retirement: increasing inequalities between groups of older workers, increasing uncertainty about the age of retirement, the way to keep lower educated workers in their jobs, sustainable working conditions, increasing risks of age discrimination, and impact of care of older relatives.

This paper offers a synthetic overview with a special attention paid to the main features of the countries’ exit patterns at the end of the working life, the prevailing public policies and the specificity of the different national employment and societal models.

The purpose of this paper is to study the determinants of wages and the labor market success of two kinds of entrepreneurial women in Germany: self‐employed and salaried businesswomen, and investigate whether ethnicity is important in these challenging jobs.

Using Lee's technique, the paper first estimates the probabilities of being in self‐employment, a salaried businesswoman, working in other non‐entrepreneurial jobs, and not working at all with a multinomial logit, and accordingly adjust the wage regressions for selection and heteroscedasticity. By employing data from the German Socio‐economic Panel one can differentiate among different types of self‐employment and business entrepreneurship, control for human capital and labor market structures, and estimate wages for native and immigrant women aged 20 to 65. The subject scope includes literature on entrepreneurship, self‐employment, gender‐edge, and immigrant earnings assimilation.

Self‐employment offers businesswomen a lucrative avenue with higher monetary rewards, albeit for a shorter spell. If salaried businesswomen went into self‐employment, they would receive considerably higher wages and for at least 30 years. However, if self‐employed businesswomen went into salaried jobs, their wages would decline. This suggests that it is the self‐employment sector that offers better opportunities and monetary success, but not many businesswomen go into it. In these two entrepreneurial outlets human capital, years‐since‐migration and ethnicity are not significant.

Future research should overcome the cross‐sectional limitation and take advantage of the panel aspect.

Many qualified, highly educated and talented women are not part of the labor market and the entrepreneurial world. Germany should encourage these women to work, as it needs skilled workers and a stronger entrepreneurial sector. Financial disparities still exist between West and East Germany.

The novelty comes from asserting that the entrepreneurial spirit can also exist in salaried jobs. The added value is the new empirical evidence on the importance of self‐employment in Germany, where women fare well and success does not depend on ethnicity.

We estimate a dynamic programming model of schooling decisions in which the degree of risk aversion can be inferred from schooling decisions. In our model, individuals are heterogeneous with respect to school and market abilities but homogeneous with respect to the degree of risk aversion. We allow endogenous schooling attainments to affect the level of risk experienced in labor market earnings through wage dispersion and employment rate dispersion. We find a low degree of relative risk aversion (0.93) and the estimates indicate that both wage and employment rate dispersions decrease significantly with schooling attainments. We find that a counterfactual increase in risk aversion will increase schooling attainments. Finally, the low degree of risk aversion implies that an increase in earnings dispersion would have little effect on schooling attainments.

Russia has undergone tumultuous changes during the transition process. This has been nowhere more evident than within the labour market. The transition has now progressed to such an extent that it is possible to examine whether the issues of a re‐capitalisation and restructuring of human capital have been addressed. This paper uses the Russian Longitudinal Monitoring Survey to assess rates of return to human capital investments for the years 1994‐1998. It utilises standard earnings functions to assess the returns to education as well as to specific levels of post‐compulsory education and training. This article places specific emphasis on firm level training and the role of the firm, for the purpose of this special issue. Results suggest, in the case of Russia, that significant and positive returns to education and training exist comparable in magnitude to those in other transition countries.

Focuses on the approach to interpreting earnings equality found in the writings of a variety of economists and in particular, technological change and its effects on the demand skill resulting in earning inequality. Argues that the evidence in favour of the technological effect is weak and presents some alternatives for further consideration.

The purpose of this paper is to examine employers’ perceptions of changes in the labour cost‐productivity gap due to the ageing of the workforce, the effects of tenure wages and employment protection on the perceived gap, and whether a perceived labour cost‐productivity gap affects employers’ recruitment and retention behaviour towards older workers.

The authors analyse surveys administered to employers in Denmark, France, Germany, Italy, the Netherlands, Poland and Sweden.

Approximately half of employers associate the ageing of the personnel with a growing gap between labour costs and productivity. Both the presence of tenure wages and employment protection rules increase the probability of employers perceiving a widening labour cost‐productivity gap due to the ageing of their workforce. A counterfactual shows that even when employment protection and tenure wage systems are abolished, 40 percent of employers expect a net cost increase. The expected labour cost‐productivity gap negatively affects both recruitment and retention of older workers.

In this paper, the wage‐productivity gap is examined through the perceptions of employers using an international comparative survey.

I use data from employers and longitudinal data from former/current recipients covering the period 1997 to early 2004 to analyze the relationship between job skills, job changes, and the evolution of wages. I analyze the effects of job skill requirements on starting wages, on-the-job training opportunities, wage growth prospects, and job turnover. The results show that jobs of different skill requirements differ in their prospects for earnings growth, independent of the workers who fill these jobs. Furthermore, these differences in wage growth opportunities across jobs are important determinants of workers’ quit propensities (explicitly controlling for unobserved worker heterogeneity). The determinants and consequences of job dynamics are investigated. The results using a multiplicity of methods, including the estimation of a multinomial endogenous switching model of wage growth, show that job changes, continuity of work involvement, and the use of cognitive skills are all critical components of the content of work experience that leads to upward mobility. The results underscore the sensitivity of recipients’ job transition patterns to changes in labor market demand conditions.