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Two firms A and B offer exact same wage profile. Pay=10,000+1000(total work experience). Total work experience includes the number of years worked at any firm.
Two firms A and B offer exact same wage profile. Pay=10,000+1000(total work experience). Total work experience includes the number of years worked at any firm. An employee works for 40 years (from age 20 to 60). Suppose an employee can either work for his whole life in firm A or work for his whole life in firm B or can change jobs. Pension schemes in both firms are given by Pension=0.02(years of service in a firm)* (ending salary). Now suppose that vesting period is 20 years. What would be his pension benefit in he worked first 10 years in firm A and the last 30 years in firm B
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