An empirical assessment of the wage premium for American veterans of World War II

This paper examines U.S. census data from 1960 to 1980 to assess the relative wages of WWII veteran and non-veteran men. Our analysis reveals that a significant portion wage gap between veterans and non-veterans (the “veteran wage premium”) is due primarily to differences in education, work experience and other socioeconomic characteristics. Our findings are consistent with the notion that greater human capital, due perhaps to the selection process for military service, or to the post-war benefits provided by the GI Bill, helped contribute to the remarkable post-war labor market success of American veterans. To a lesser extent, veterans may also have benefited from preferential labor market treatment, or from intangible aspects of military experience that enhanced their returns to earnings-related characteristics.