Wage premium in STEM careers

In this study, we explore wage dynamics of STEM and nonSTEM professionals during their working life. We analyze wage differences along the wage distribution and with labor market experience. The main novelty in the paper is decomposing the wage growth in separate effects of experience, cohort and time, and accounting for potential depreciation. The identification used in this procedure is based on the ideas of the human capital theory. The empirical realization employs data from the Russian Longitudinal Monitoring Survey. It shows that Russian STEM graduates accumulate human capital at a slower rate than nonSTEM graduates do. However, STEM skills acquired by the beginning of the career are less exposed to obsoleteness than nonSTEM. This reflects a stronger cohort effect for the latter group, and is an implication of the systemic change and the transformational recession during the 1990s.