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Education and Work

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Author Info
Philip Trostel
Ian Walker

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Abstract

This paper examines the relationship between the incentives to work and to invest in human capital through education in a lifecycle optimizing model. These incentives are shown to be mutually reinforcing in a simple stylized model. This theoretical prediction is investigated empirically using three large micro datasets covering a broad range of countries. As one might expect, education and work are strongly positively correlated. This correlation has important implications for models of fiscal policy and economic growth. It also has important implications for the estimation of labor supply and the rate of return to education.

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Publisher Info
Article provided by Taylor and Francis Journals in its journal Education Economics.

Volume (Year): 14 (2006)
Issue (Month): 4 (December)
Pages: 377-399
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Handle: RePEc:taf:edecon:v:14:y:2006:i:4:p:377-399

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Keywords: Education; labor supply; lifecycle;

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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. von Greiff, Camilo, 2007. "Effects of Redistribution Policies - Who Gains and Who Loses?," Research Papers in Economics 2007:12, Stockholm University, Department of Economics. [Downloadable!]
  2. Alison L. Booth & Melvyn B. Coles, 2008. "Tax Policy and Returns to Education," CEPR Discussion Papers 591, Centre for Economic Policy Research, Research School of Social Sciences, Australian National University. [Downloadable!]
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