Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/111516
Authors: 
Marinescu, Ioana E.
Triyana, Margaret
Year of Publication: 
2015
Series/Report no.: 
IZA Discussion Papers 9066
Abstract: 
What are the sources of wage growth in developing countries? In the US, general labor market experience is the key source of wage growth, with job seniority playing a smaller role. By contrast, in Indonesia, the 10-year return to seniority is 24 to 29%, which is higher than the return to experience. Furthermore, we estimate a 35% return to ten years of tenure in the formal sector, with no significant return to tenure in the informal sector. The difference in the sources of wage growth in Indonesia versus the US may be a reflection of Indonesia's lower level of development.
Subjects: 
experience
formality
informality
wages
tenure
JEL: 
J31
O1
Document Type: 
Working Paper

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