Inga and Ron both work for the same firm on the same career ladder.Each has the same stock of human capital except for one difference: Inga has worked at the firm for 10 continuous years but Ron has had two leaves of absence mixed in with his 10 years of experience with the firm.One would expect

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Inga's continuous 10 years of experience would have allowed her to gain more knowledge and skills specific to the firm which would make her a more valuable employee. Ron on the other hand would have gaps in his experience due to his leave of absence which would have hindered his skill development. Therefore, Inga is likely to earn more than Ron.

Inga and Ron Both Work for the Same Firm on the Same