TY  - JOUR
A1  - Hasl, Andrea
A1  - Voelkle, Manuel
A1  - Kretschmann, Julia
A1  - Richter, Dirk
A1  - Brunner, Martin
T1  - A dynamic structural equation approach to modeling wage dynamics and cumulative advantage across the lifespan
JF  - Multivariate Behavioral Research
N2  - Wages and wage dynamics directly affect individuals' and families' daily lives. In this article, we show how major theoretical branches of research on wages and inequality-that is, cumulative advantage (CA), human capital theory, and the lifespan perspective-can be integrated into a coherent statistical framework and analyzed with multilevel dynamic structural equation modeling (DSEM). This opens up a new way to empirically investigate the mechanisms that drive growing inequality over time. We demonstrate the new approach by making use of longitudinal, representative U.S. data (NLSY-79). Analyses revealed fundamental between-person differences in both initial wages and autoregressive wage growth rates across the lifespan. Only 0.5% of the sample experienced a "strict" CA and unbounded wage growth, whereas most individuals revealed logarithmic wage growth over time. Adolescent intelligence and adult educational levels explained substantial heterogeneity in both parameters. We discuss how DSEM may help researchers study CA processes and related developmental dynamics, and we highlight the extensions and limitations of the DSEM framework.
KW  - Dynamic Structural Equation Modeling (DSEM)
KW  - wage dynamics
KW  - cumulative advantage (CA)
KW  - autoregressive wage growth
KW  - human capital theory
Y1  - 2022
U6  - https://doi.org/10.1080/00273171.2022.2029339
SN  - 0027-3171
SN  - 1532-7906
VL  - 58
IS  - 3
SP  - 504
EP  - 525
PB  - Routledge, Taylor & Francis Group
CY  - Abingdon
ER  -