Does the Human-Capital/Educational-Sorting Debate Matter for Development Policy?
Abstract
If education increases human capital, subsidizing education can generate economic growth and combat poverty. Estimates of its return suggest that education is a good social investment. In sorting models, the return reflects in part the information about productivity revealed by the worker's education. Thus the social and private returns diverge. It might appear that if we believe the sorting model, we should be less swayed by evidence that estimated returns to education exceed the social discount rate, and therefore less likely to support education-based development policies. This conclusion is shown to be incorrect.(This abstract was borrowed from another version of this item.)
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Bibliographic Info
Article provided by American Economic Association in its journal American Economic Review.
Volume (Year): 84 (1994)
Issue (Month): 1 (March)
Pages: 353-58
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Keywords:Other versions of this item:
- Kevin Lang, 1992. "Does the Human-Capital/Educational-Sorting Debate Matter for Development Policy?," NBER Working Papers 4052, National Bureau of Economic Research, Inc.
References
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- Joseph E. Stiglitz, 1973.
"The Theory of 'Screening', Education, and the Distribution of Income,"
Cowles Foundation Discussion Papers
354, Cowles Foundation for Research in Economics, Yale University.
- Stiglitz, Joseph E, 1975. "The Theory of "Screening," Education, and the Distribution of Income," American Economic Review, American Economic Association, vol. 65(3), pages 283-300, June.
- Lang, Kevin, 1987. "Pareto Improving Minimum Wage Laws," Economic Inquiry, Western Economic Association International, vol. 25(1), pages 145-58, January.
Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Anupa Bir & Karen Eggleston, 2003. "Physician Dual Practice: Access Enhancement or Demand Inducement?," Discussion Papers Series, Department of Economics, Tufts University 0311, Department of Economics, Tufts University.
- Norman Ireland & Robin A. Naylor & Jeremy Smith & Shqiponja Telhaj, 2009.
"Educational Returns, Ability Composition and Cohort Effects: Theory and Evidence for Cohorts of Early-Career UK Graduates,"
CEP Discussion Papers
dp0939, Centre for Economic Performance, LSE.
- Ireland, Norman & Naylor, Robin A. & Smith, Jeremy & Telhaj, Shqiponja, 2009. "Educational Returns, ability composition and cohort effects : theory and evidence for cohorts of early-career UK graduates," The Warwick Economics Research Paper Series (TWERPS) 906, University of Warwick, Department of Economics.
- Brown, Sarah & Sessions, John G., 1999. "Education and employment status: a test of the strong screening hypothesis in Italy," Economics of Education Review, Elsevier, vol. 18(4), pages 397-404, October.
- Aakvik, Arild & Kjerstad, Egil, 2002.
"Skill Formation among Vocational Rehabilitation Clients – Public Policy vs Private Incentives,"
Working Papers in Economics
01/02, University of Bergen, Department of Economics.
- Arild Aakvik & Egil Kjerstad, 2003. "Skill formation among vocational rehabilitation clients - public policy vs private incentives," Education Economics, Taylor and Francis Journals, vol. 11(3), pages 219-237.
- Aakvik, Arild & Kjerstad, Egil, 2002. "Skill formation among vocational rehabilitation clients - public policy vs private incentives," Working paper Series 0201, Department of Economics, University of Bergen.
- Hornig, Stephan O. & Rottmann, Horst & Wapler, Rüdiger, 2009.
"Information asymmetry, education signals and the case of Ethnic and Native Germans,"
IAB Discussion Paper
200914, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
- Stephan O. Hornig & Horst Rottmann & Rüdiger Wapler, 2009. "Information Asymmetry, Education Signals and the Case of Ethnic and Native Germans," CESifo Working Paper Series 2683, CESifo Group Munich.
- Brown, Sarah & Sessions, John G., 2006. "Evidence on the relationship between firm-based screening and the returns to education," Economics of Education Review, Elsevier, vol. 25(5), pages 498-509, October.
- Self, Sharmistha & Grabowski, Richard, 2006. "The Asian Financial Crisis: Impact on Human Development," Review of Applied Economics, Review of Applied Economics, vol. 2(2).
- John H. Tyler & Richard J. Murnane & John B. Willett, 1998. "Estimating the Impact of the GED on the Earnings of Young Dropouts Using a Series of Natural Experiments," NBER Working Papers 6391, National Bureau of Economic Research, Inc.
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