Abstract:
Standard human capital theory predicts a positive, concave experience-wage relationship. Using repeated cross-sectional data from China (2010-2023), we document a structural breakdown of this canonical Mincer profile by 2023, as aggregate returns to experience become statistically insignificant. This aggregate collapse conceals a sharp institutional divergence. In competitive markets, late-career experience returns turn negative. Conversely, institutional sectors-specifically state-owned enterprises and politically connected employment-maintain stable positive returns. These findings suggest that during rapid technological change, experience premiums are increasingly governed by institutional wage-setting mechanisms rather than uniform market productivity.
