Hirsch, Barry T. 1978. "Predicting Earnings Distributions Across Cities: The Human Capital Model vs. the National Distribution Hypothesis." Journal of Human Resources 13(3):366-384.

Microdata are used to examine the relative ability of the human capital model and of an alternative national distribution hypothesis to generate predicted distributions of earnings that are close to actual distributions within 48 SMSAs. Surprisingly, the national distribution hypothesis is found to be relatively more robust in predicting earnings distributions than the fixed-parameter of human capital model. Earnings functions are then estimated separately within each SMSA, and it is found that the parameters of the human capital model vary significantly across labor markets. Further analysis examines the relationship between earnings distributions, the estimated parameters of the model, city size, and region.

The author is Assistant Professor of Economics, University of North Carolina at Greensboro. William R. Johnson, Terry G. Seaks, Roger Sherman, and two anonymous referees made helpful comments and suggestions. The research is drawn largely from my doctoral dissertation. Support by doctoral dissertation grant #DL91-51-76-11 from the U.S. Department of Labor, Employment and Training Administration, is gratefully acknowledged.

© 2003 by the Board of Regents of the University of Wisconsin System

US ISSN 0022-166X

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