Employment Exposure: Employment and Wage Effects in Urban Malawi

Labor earnings are critical to exiting poverty; thus, understanding the returns to the determinants of wage growth is important. We examine one important driver of wage growth: acquired work experience, using an experiment that randomized probabilistic job offers to estimate the employment and wage effects of short-term jobs among young men in a low-income urban setting. The results suggest large returns even among relatively well-educated yet still underemployed individuals. Returns are largest among those scoring poorly on a literacy and numeracy test. Suggestive evidence points to exposure to a broader social job network as a likely driver for the returns.