Ljubica Nedelkoska (Zeppelin University and Harvard University)

“Learning by Problem-solving”

(at Dipartimento di Economia “S. Cognetti de Martiis”)

abstract

We analyze the dynamics of learning by problem-solving at the job. We propose that the exposure to challenging job tasks increases skills and therefore work productivity. As a result, job complexity leads to higher wages. We test our hypotheses using a large panel of German employees with complete work histories. We find that job complexity leads to higher levels of wages and higher wage growth. The returns to job complexity are somewhat greater for more skilled people. Preliminary results further suggest that from the individual perspective, with sufficiently low depreciation rate, people prefer complex over simple jobs. From the macro perspective, our analysis shows that wage dispersion is higher in more complex jobs, resulting in higher wage inequality.