Human Capital and Occupational Mobility: The Case of Brazil

Skill transferability is essential for occupational mobility and adapting to external shocks, yet detailed data on workers’ skills is often scarce and costly to collect, specially in developing countries. This paper explores whether the American O*NET database, one of the most popular databases used in studies on occupational skills, can provide relevant insights in the Brazilian context. By complementing it with unique longitudinal administrative Brazilian employer-employee data, this paper validates the application of skill similarity measures in a country lacking data on workers’ skills. Applying the same methodology produces results in Brazil comparable to those in the American literature, and further refining the similarity measure increases its power to explain occupational mobility in the country. Then, this paper uses the validated measure to analyze the role of skill transferability in explaining Brazilian mobility patterns, exploring heterogeneity across different genders, age groups, and education levels.