Life‐Cycle Wage Growth and Internal Migration

ABSTRACT I document new facts on life‐cycle wage growth within three countries: Brazil, Mexico, and the United States. In every case, I find that experience–wage profiles are steeper in rich states. Differences in education and industry mix can account for a large share of the covariance between income and profile steepness in both developing countries, while differences in occupations are key in every case. Using a general equilibrium model, I estimate meaningful productivity gains from inducing migration to places with better learning environment and find that migration costs are important in explaining cross‐country differences in life‐cycle wage growth.