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<p>This dissertation consists of three separate essays that use dynamic models to
better understand the human capital accumulation process. First, I analyze the role
of migration in human capital accumulation and how migration varies over the business
cycle. An interesting trend in the data is that, over the period of the Great Recession,
overall migration rates in the US remained close to their respective long-term trends.
However, migration evolved differently by employment status: unemployed workers were
more likely to migrate during the recession and employed workers less likely. To isolate
mechanisms explaining this divergence, I estimate a dynamic, non-stationary search
model of migration using a national longitudinal survey from 2004-2013. I focus on
the role of employment frictions on migration decisions in addition to other explanations
in the literature. My results show that a divergence in job offer and job destruction
rates caused differing migration incentives by employment status. I also find that
migration rates were muted because of the national scope of the Great Recession. Model
simulations show that spatial unemployment insurance in the form of a moving subsidy
can help workers move to more favorable markets.</p><p>In the second essay, my coauthors
and I explore the role of information frictions in the acquisition of human capital.
Specifically, we investigate the determinants of college attrition in a setting where
individuals have imperfect information about their schooling ability and labor market
productivity. We estimate a dynamic structural model of schooling and work decisions,
where high school graduates choose a bundle of education and work combinations. We
take into account the heterogeneity in schooling investments by distinguishing between
two- and four-year colleges and graduate school, as well as science and non-science
majors for four-year colleges. Individuals may also choose whether to work full-time,
part-time, or not at all. A key feature of our approach is to account for correlated
learning through college grades and wages, thus implying that individuals may leave
or re-enter college as a result of the arrival of new information on their ability
and/or productivity. We use our results to quantify the importance of informational
frictions in explaining the observed school-to-work transitions and to examine sorting
patterns.</p><p>In the third essay, my coauthors and I investigate the evolution over
the last two decades in the wage returns to schooling and early work experience. </p><p>Using
data from the 1979 and 1997 panels of the National Longitudinal Survey of Youth, we
isolate changes in skill prices from changes in composition by estimating a dynamic
model of schooling and work decisions. Importantly, this allows us to account for
the endogenous nature of the changes in educational and accumulated work experience
over this time period. We find an increase over this period in the returns to working
in high school, but a decrease in the returns to working while in college. We also
find an increase in the incidence of working in college, but that any detrimental
impact of in-college work experience is offset by changes in other observable characteristics.
Overall, our decomposition of the evolution in skill premia suggests that both price
and composition effects play an important role. The role of unobserved ability is
also important.</p>
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