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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.
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TL;DR: In this article, the authors examined the motivations and benefits for pursuing or not pursuing the Human Resource Certification Institute (HRCI) and SPHR and found that participants pursuing SPHR were more likely to report intrinsic motivations pursuing certification, while respondents not pursuing certification were concerned about time constraints.
Abstract: Purpose – The aim of this paper is to examine the motivations and benefits for pursuing or not pursuing the PHR and SPHR.Design/methodology/approach – Using a sample of 1,862 participants, the study used multinomial logistic and hierarchical linear regression to test six hypotheses.Findings – Participants pursuing SPHR were more likely to report intrinsic motivations pursuing certification, while PHR respondents were more likely to report extrinsic reasons. Other‐driven reasons were not significant predictors. Respondents not pursuing certification saw a lack of perceived benefits. Non‐pursuers of SPHR were concerned about time constraints. The pursuing and non‐pursuing groups did exhibit differences in their demographic and commitment profiles.Research limitations/implications – The sample is limited to only those professionals active in their local SHRM chapters. The data were cross‐sectional. Future research needs to address the validity of Human Resource Certification Institute (HRCI) certification an...
7 citations
TL;DR: This paper examined repeated cross-sections of hundreds of undergraduate students' expectations at mid-semester of their own final course grades at two Australian universities and found that a simple rational expectations model of expectation formation provides a poorer fit to the data than a utility model involving either direct utility benefits from expectations, or a psychological need to hold high expectations.
7 citations
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12 Jan 2010TL;DR: In this paper, the authors analyzed the wage gap at different points in the conditional distribution of income according to ethnic or racial status using data from the National Household Survey of December 2000.
Abstract: This work analyzes the wage gap at different points in the conditional distribution of income according to ethnic or racial status using data from the National Household Survey of December 2000. The methodology involves the estimation of Mincer-type equations, including correction of the endogeneity bias present in these equations and uses the methodology of disaggregation according to Melly (2005). The findings show a predominant effect of the “unexplained” proportion of the wage gap between Colombians of African descent and the rest of the population which could be the result of racial discrimination.
6 citations
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01 Jan 2006
TL;DR: In this paper, the authors used swedish administrative data to investigate the evidence on the returns to college choice in Sweden. And they found that the evidence was robust to the choice of college choice.
Abstract: How robust is the evidence on the returns to college choice? : results using swedish administrative data
6 citations
TL;DR: This article examined the effects of community-level volunteering on an individual's choices regarding time -whether to work and whether to volunteer, and found that individuals are more likely to volunteer when others in their communities do so.
Abstract: In this analysis, I examine the effects of community-level volunteering on an individual’s choices regarding time – whether to work and whether to volunteer. In order to better explain the decision to volunteer, a classic pure public goods structure is contrasted with a less restrictive impure public goods model that admits other possible private motivations. The results of this study undermine the neoclassical notion that volunteering can be understood solely as a pure public good that is provided less when others are seen to be contributing. In fact, individuals are found to be more, not less, likely to volunteer when others in their communities do so. An innovative instrumental variables strategy is used to account for reflection bias and the possible endogeneity caused by selective sorting of individuals into neighborhoods, which allows for a causal interpretation of these results. Employment regressions provide preliminary evidence that average volunteering relates, to some extent, with the decision of whether to participate in the labor force. Variations in the effect of average volunteering across age and gender are also explored. The present work is unique by virtue of its use of a large and representative dataset, along with rigorous statistical testing. I use United States Census 2000 Summary File 3 and Current Population Survey (CPS) 2004–2007 September Supplement file data and control for various individual and community-level characteristics.
6 citations