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Sheepskin effects and the returns to education in New Zealand: Do they differ by ethnic groups?

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  • John Gibson

Abstract

Sheepskin effects are the wage returns specific to educational credentials rather than to accumulated years of education. They can occur because credentials may signal workers' productivity. Signalling high productivity may be more valuable for members of ethnic minority groups if employers practice statistical discrimination. Many studies estimate sheepskin effects indirectly, from non-linear wage returns to schooling years that correspond to the “usual” time taken to complete a qualification, but such methods are likely to be biased. This study directly estimates sheepskin effects in New Zealand using a special survey with information on both years of education and qualifications received. The results show large sheepskin effects, with the returns to credentials exceeding the returns to years of education, especially for ethnic minorities.

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File URL: http://www.tandfonline.com/doi/abs/10.1080/00779950009544323
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Bibliographic Info

Article provided by Taylor and Francis Journals in its journal New Zealand Economic Papers.

Volume (Year): 34 (2000)
Issue (Month): 2 ()
Pages: 201-220

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Handle: RePEc:taf:nzecpp:v:34:y:2000:i:2:p:201-220

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Cited by:
  1. Jhon James Mora, 2003. "Sheepskin effects and screening in Colombia," Colombian Economic Journal, Academia Colombiana de Ciencias Economicas, Colegio Mayor de Nuestra Senora del Rosario, Pontificia Universidad Javeriana, Universidad de Antioquia, Universidad de los Andes, Universidad del Valle, Un, vol. 1(1), pages 95-108, December.
  2. David. C. Maré, 2004. "Ideas for Growth?," Development and Comp Systems 0404007, EconWPA.
  3. John Gibson & Trinh Le & Steven Stillman, 2007. "What Explains the Wealth Gap between Immigrants and the New Zealand Born?," Working Papers in Economics 07/02, University of Waikato, Department of Economics.
  4. Nicolas Hérault & Rezida Zakirova, 2011. "Sheepskin Effects in the Returns to Education: Accounting for Enrolment and Completion Effects," Melbourne Institute Working Paper Series wp2011n04, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  5. Engelbrecht, Hans-Jurgen & Mahon, Anne, 2003. "Maori And The Information Workforce, 1991-2001," Discussion Papers 23697, Massey University, Department of Applied and International Economics.
  6. John Gibson, 2003. "Do Lower Expected Wage Benefits Explain Ethnic Age Gaps in Job-Related Training? Evidence from New Zealand," Working Papers 03_03, Motu Economic and Public Policy Research.
  7. Veronica Jacobsen & Nicholas Mays & Ron Crawford & Barbara Annesley & Paul Christoffel & Grant Johnston & Sid Durbin, 2002. "Investing in Well-being: An Analytical Framework," Treasury Working Paper Series 02/23, New Zealand Treasury.
  8. Habermalz, Steffen, 2003. "An Examination of Sheepskin Effects Over Time," IZA Discussion Papers 725, Institute for the Study of Labor (IZA).
  9. John Gibson, 2003. "Do Lower Expected Wage Benefits Explain Ethnic Gaps In Job- Related Training? Evidence From New Zealand," Labor and Demography 0310004, EconWPA.
  10. Gail Pacheco, 2012. "The cost of poor transitions for youth," Working Papers 2012-09, Auckland University of Technology, Department of Economics.
  11. John Gibson & Trinh Le & Grant Scobie, 2006. "Household Bargaining Over Wealth And The Adequacy Of Women'S Retirement Incomes In New Zealand," Feminist Economics, Taylor and Francis Journals, vol. 12(1-2), pages 221-246.
  12. Jessica Dye & Stephanie Rossouw & Gail Pacheco, 2012. "Well-being of Women in New Zealand: The Changing Landscape," Working Papers 2012-07, Auckland University of Technology, Department of Economics.

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