Lifetime Career Value and the Supply of Accountants
We investigate the career paths of college graduates majoring in accounting and business to account for the labor market supply of accountants. We begin by documenting the demographics and earnings profiles of the broadly defined accounting profession. Using a structural approach, the lifetime career value can be calculated from the lifetime wage/benefits profiles within each sector and the career switching opportunities/costs between the sectors. To account for these dynamic features, we use a large sample of resume data and estimate parameters through the discrete choice dynamic programming (DCDP) framework. The computed parameters indicate that not only the initial salary and non-wage benefits, but also the job mobility across sectors over time, have a considerable impact on the lifetime career value and hence on the initial stage of career choices. Our counterfactual study suggests that an increase in entry-level accountants’ wages has a meaningful effect on their career choices for Big Four and non-Big Four accounting companies.
- Research Seminar
- Finance & Accounting
- Thu. 7 Mar. 2024
- 11:10 - 12:30