Dierk Hirschel

Do high incomes reflect individual performance?

27 Seiten · 7,70 EUR
(21. Juli 2006)

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Introduction:

Hierschel also studies explanations for labor income differentials beyond the meritocratic, thus picking up from where the first contribution leaves off. Using the Socio-Economic Panel (SOEP), a body of data collected by the DIW, the author’s empirical focus is on Germany and the group of “high earners” – usually not the focus in the literature – here defined as those with an income that is at least double the average full-time salary. Using a comprehensive econometric model, the author explores the determinants behind this group’s income, from individual investments of human capital to group characteristics like gender, social background, kind of work, etc. A total of almost twenty individual hypotheses are tested. The central result is that not only education and gender, but also background plays a primary role, whereby the latter variable is even underestimated in a simple model, since it is additionally linked to interaction effects resulting from the choice of education. Mueller’s observation that qualifications are only the precondition of a successful career, is also confirmed in this analysis. Those equipped with “social capital” in Bourdieu’s sense remain privileged as always in terms of career opportunities.