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Working Paper No. 14

Rates of Depreciation of Human Capital Due to Nonuse

Working Paper
Reference
Gustafsson, Siv (1977). “Rates of Depreciation of Human Capital Due to Nonuse”. IFN Working Paper No. 14. Stockholm: Research Institute of Industrial Economics (IFN).

Author
Siv Gustafsson

How important for success on the job is uninterrupted labor force participation? Data on labor force status for a 15 year period for individual salaried employees in Swedish Industry makes possible the estimation of the effect of years of experience and years of non-experience on earnings. One result is that both women and men experience salary decreases by labor force interruptions. However, net investment during non-experience years found to be positive, women as well as men return to the labor market with a larger amount of human capital after the interruption than before the interruption.