Posted Content•
The causal effect of education on earnings
TL;DR: This paper surveys the recent literature on the causal relationship between education and earnings and concludes that the average (or average marginal) return to education is not much below the estimate that emerges from a standard human capital earnings function fit by OLS.
Abstract: This paper surveys the recent literature on the causal relationship between education and earnings. I focus on four areas of work: theoretical and econometric advances in modelling the causal effect of education in the presence of heterogeneous returns to schooling; recent studies that use institutional aspects of the education system to form instrumental variables estimates of the return to schooling; recent studies of the earnings and schooling of twins; and recent attempts to explicitly model sources of heterogeneity in the returns to education. Consistent with earlier surveys of the literature, I conclude that the average (or average marginal) return to education is not much below the estimate that emerges from a standard human capital earnings function fit by OLS. Evidence from the latest studies of identical twins suggests a small upward "ability" bias -- on the order of 10%. A consistent finding among studies using instrumental variables based on institutional changes in the education system is that the estimated returns to schooling are 20-40% above the corresponding OLS estimates. Part of the explanation for this finding may be that marginal returns to schooling for certain subgroups -- particularly relatively disadvantaged groups with low education outcomes -- are higher than the average marginal returns to education in the population as a whole.
Citations
More filters
TL;DR: In this paper, the direct and indirect effects of parental background on employees' earnings were analyzed using data from the German Socioeconomic Panel (GSOEP), and they found that the returns to schooling depend on the employees' parental background.
Abstract: Summary Using data from the German Socioeconomic Panel (GSOEP), the study analyzes the direct and indirect effects of parental background on employees' earnings. To examine indirect effects we estimate the determinants of the employees' years of schooling. In a second step, we run wage regressions to examine direct effects. Our results suggest that the direct and indirect effects of parental background driving the intergenerational correlation of socioeconomic status are complex. It is not only important to differentiate between mother's and father's education. It is also important to take into account other parental characteristics such as maternal labor force participation and the parents' occupational status and fertility. Moreover, we find that interaction effects play an important role. The returns to schooling depend on the employees' parental background.
15 citations
Posted Content•
01 Jan 2014TL;DR: This article studied the effect of heterogeneity and risk in individuals' returns to college and found that college education comes with two inherent options: (i) college enrollees may quit after obtaining additional information on their post-graduation wages (i.e., college dropout) and (ii) college graduates may take jobs that do not require a college degree (e.g., underemployment), eectively protecting themselves from the left tail of the returns-to-college distribution.
Abstract: We study college enrollment and graduation decisions in the presence of heterogeneity and risk in individuals’ returns to college. College education comes with two inherent options: (i) college enrollees may quit after obtaining additional information on their post-graduation wages (i.e., college dropout) and (ii) college graduates may take jobs that do not require a college degree (i.e., underemployment), eectively protecting themselves from the left tail of the returns-to-college distribution. We show that the interaction between these option-like features and the rising dispersion in the returns-to-college distribution|evidenced by the rising wage dispersion especially among college graduates|is key to understanding the muted response of college enrollment and graduation rates to the substantial increase in the observed college premium in the United States since 1980. Once taken into account, we
15 citations
Dissertation•
07 Oct 2011
TL;DR: In this article, a meta-analyse of the relation entre l'enseignement superieur de masse and l'economie de la connaissance is presented.
Abstract: Ce document propose une analyse des relations entre l'enseignement superieur de masse et l'economie de la connaissance sous l'angle de la valeur des diplomes, la valeur salariale, la valeur professionnelle mais egalement la valeur plus subjective percue par les individus Il est organise autour de trois chapitres Le premier part du constat de la forte heterogeneite des rendements salariaux l'enseignement superieur dans le monde A partir d'une metaanalyse, il montre que ces taux de rendement sont etroitement dependants des structures economiques et du developpement de l'enseignement superieur dans chaque pays Le deuxieme chapitre se focalise sur l'evolution de l'enseignement superieur de masse en France et ses relations avec le marche du travail Reinterrogeant la theorie de l'eligibilite proposee il y a plus de 35 ans, il met en relation la degradation des conditions d'insertion des diplomes avec les changements dans l'allocation du temps des etudiants dans les premieres annees d'enseignement superieur L'analyse dans le dernier chapitre se deplace vers le niveau le plus eleve du systeme LMD, la formation doctorale, parfois presentee comme l'un des moteurs d'une economie fondee sur la connaissance Elle pose notamment la question de la transferabilite des competences acquises par les doctorants pour se preparer aux carrieres academiques et qui sont souvent peu valorisees en France sur le segment prive du marche du travail scientifique
15 citations
01 Dec 2007
TL;DR: The paper concludes that governments and civil society should consider expanding high quality, cost-effective early child development programmes.
Abstract: Awareness of child development is increasing in developing countries. The health sector has advocated for early child development programmes for children with low birth weight, developmental delays, and from low-income disadvantaged environments. Estimates are that over 200 million children in developing countries under five years of age fail to reach their developmental potential because of risk factors associated with poverty. These risk factors are characterized in particular as including stunting, inadequate cognitive stimulation, iodine deficiencies, and iron deficiency anemia; but it is claimed that the evidence is also sufficient to warrant interventions for malaria, intrauterine growth restriction, maternal depression, exposure to violence, and exposure to heavy metals. Therefore, the paper concludes that governments and civil society should consider expanding high quality, cost-effective early child development programmes.In order to create a better informational basis for such studies in the future, it is important to be alert to opportunities for improving data collection and encouraging the collection of new and better data with better indicators of costs and benefits of Early Childhood Development (ECD) program.Careful systematic analyses of such data will permit enhancing importantly our knowledge of ECD programs in developing countries.
15 citations
TL;DR: In this paper, the authors show that there are sharp non-linearities which do not seem to be only due to certification effects and that it is important to account for the impact of education on the returns to other observable characteristics such as age and seniority.
15 citations