Economic Research
Economic Research PapersBrowse Research by Topic
Staff Report 448
Human Capital Values and Returns: Bounds Implied By Earnings and Asset Returns Data
Mark Huggett
Greg Kaplan - Research Economist
July 2010
Abstract
We provide theory for calculating bounds on both the value of an individual’s human capital and the return on an individual’s human capital, given knowledge of the process governing earnings and financial asset returns. We calculate bounds using U.S. data on male earnings and financial asset returns. The large idiosyncratic component of earnings risk implies that bounds on values and returns are quite loose. However, when aggregate shocks are the only source of earnings risk, both bounds are tight.
(PDF)
(PS)
Related Links
-
Inferring Labor Income Risk From Economic Choices: An Indirect Inference Approach
Staff Report 450 - July 2010 -
Moving Back Home: Insurance Against Labor Market Risk
Staff Report 449 - July 2010 -
Taxation of Human Capital and Wage Inequality: A Cross-Country Analysis
Staff Report 438 - November 2009 -
Unequal We Stand: An Empirical Analysis of Economic Inequality in the United States, 1967–2006
Staff Report 436 - October 2009 -
Consumption and Labor Supply with Partial Insurance: An Analytical Framework
Staff Report 432 - August 2009
