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Can Falling Supply Explain The Rising Return To College For Younger Men? A Cohort-Based Analysis

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David Card
Thomas Lemieux

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Abstract

Although the college-high school wage gap for younger U. S. men has doubled over the past 30 years, the gap for older men has remained nearly constant. In the United Kingdom and Canada the college-high school wage gap also increased for younger relative to older men. Using a model with imperfect substitution between similarly educated workers in different age groups, we argue that these shifts reflect changes in the relative supply of highly educated workers across age groups. The driving force behind these changes is the slowdown in the rate of growth of educational attainment that began with cohorts born in the early 1950s in all three countries. © 2001 the President and Fellows of Harvard College and the Massachusetts Institute of Technology

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Article provided by MIT Press in its journal The Quarterly Journal of Economics.

Volume (Year): 116 (2001)
Issue (Month): 2 (May)
Pages: 705-746
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Handle: RePEc:tpr:qjecon:v:116:y:2001:i:2:p:705-746

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References listed on IDEAS
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. Riddell, W.C., 1993. "Unionization in Canada and the United States: A Tale of Two Countries," Papers 1993-1, Queen's at Kingston - Sch. of Indus. Relat. Papers in Industrial Relations.
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  2. Welch, Finis, 1979. "Effects of Cohort Size on Earnings: The Baby Boom Babies' Financial Bust," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages S65-97, October. [Downloadable!] (restricted)
  3. Richard B. Freeman & Karen Needels, 1993. "Skill Differentials in Canada in an Era of Rising Labor Market Inequality," NBER Chapters, in: Small Differences That Matter: Labor Markets and Income Maintenance in Canada and the United States, pages 45-68 National Bureau of Economic Research, Inc. [Downloadable!]
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  4. Finis Welch, 1979. "Effects of Cohort Size on Earnings: The Baby Boom Babies' Financial Bust," UCLA Economics Working Papers 146, UCLA Department of Economics. [Downloadable!]
  5. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier. [Downloadable!] (restricted)
  6. Murphy, Kevin M & Welch, Finis, 1990. "Empirical Age-Earnings Profiles," Journal of Labor Economics, University of Chicago Press, vol. 8(2), pages 202-29, April. [Downloadable!] (restricted)
  7. Johnson, George E, 1997. "Changes in Earnings Inequality: The Role of Demand Shifts," Journal of Economic Perspectives, American Economic Association, vol. 11(2), pages 41-54, Spring. [Downloadable!] (restricted)
  8. David Card, 1998. "Falling Union Membership and Rising Wage Inequality: What's the Connection?," NBER Working Papers 6520, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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