Wage Growth, Human Capital and Financial Investment

23 Pages Posted: 23 Dec 2005

See all articles by Sarah Brown

Sarah Brown

University of Sheffield - Department of Economics; IZA Institute of Labor Economics

Karl Taylor

University of Sheffield - Department of Economics

Abstract

The aim of this paper is to explore the relationship between wage growth, human capital and investment in financial assets at the individual level. We investigate this relationship using data from five waves of the British Household Panel Survey. We exploit panel data enabling us to determine the change in real wages experienced by individuals across four different time horizons, 1995-1996, 1995-1998, 1995-1700 and 1700-1. Our findings support a positive association between financial assets and wage growth with this relationship becoming more pronounced over time. In addition, our results suggest that investment in financial assets is positively associated with returns to human capital investment.

Suggested Citation

Brown, Sarah and Taylor, Karl B., Wage Growth, Human Capital and Financial Investment. Manchester School, Vol. 73, No. 6, pp. 686-708, December 2005. Available at SSRN: https://ssrn.com/abstract=857693 or http://dx.doi.org/10.1111/j.1467-9957.2005.00472.x

Sarah Brown

University of Sheffield - Department of Economics

9 Mappin Street
Sheffield, S1 4DT
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Karl B. Taylor (Contact Author)

University of Sheffield - Department of Economics ( email )

9 Mappin Street
Sheffield, S1 4DT
United Kingdom

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