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dc.contributor.authorDiaz-Serrano, Luisen_US
dc.contributor.authorHartog, Joopen_US
dc.contributor.authorSkyt Nielsen, Helenaen_US
dc.description.abstractIn this paper we test for risk compensation in wages using Danish panel data. With the conviction that the type of education is as important as the education length, we use a very detailed description of the type of education reached by the Danish population to calculate different measures of earnings risk by education. Our long panel data set also allows us to decompose shocks in earnings in a permanent and a transitory component. We test the role of the risks associated to both components in wage compensation. We also experiment with new measures of earnings risk based on transitory intertemporal fluctuations in earnings. Thus, we get closer to risk measures catching the intrinsic long-run feature of schooling-risks and the required compensation. In concordance to what theory predicts, we find that the labor market compensates for such foreseeable risks. Hence, we state a return-risk trade-off for the human capital investments in Denmark.en_US
dc.publisherInstitute for the Study of Labor (IZA) Bonnen_US
dc.relation.ispartofseriesIZA Discussion paper series 963en_US
dc.subject.keywordskewness affectionen_US
dc.subject.keywordschooling risken_US
dc.subject.keywordearnings shocksen_US
dc.titleCompensating wage differentials for schooling risk in Denmarken_US
dc.typeWorking Paperen_US
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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