TITLE:
Intergenerational Real Wages, Technological Change, and Economic Growth in Colombia
AUTHORS:
Fernando Mesa
KEYWORDS:
Human Capital Skill Occupational Choice Labour Productivity, Demographic Trends, Macroeconomic Effects, Wage Levels and Structure Wage Differentials
JOURNAL NAME:
Modern Economy,
Vol.7 No.2,
February
17,
2016
ABSTRACT: This
paper focuses on the decomposition of real wages in Colombia both by workers’
ages and by cohorts, which overlap over time. The paper analyses how the
Colombia’s labour structure has undergone important changes in the period
1982-2007. This period has been characterized by a demographic transition that
has tilted the balance from a relatively young population to an older one. The
effects of capital accumulation have been estimated and modelled considering
the presence of ever more sophisticated machinery, usually replacing
less-skilled, younger workers, in relation to older and more qualified ones. In
general real wages present a curved shape for each generation, as is
acknowledged in the life-cycle hypothesis, according to which people generally
start their working life with low incomes and rising debts and then obtain
higher income and accumulate assets.