Estimating the Return to Endogenous Schooling Decisions via Conditional Second Moments
AbstractThis paper employs conditional second moments to identify the impact of education in wage regressions where education is treated as endogenous. This approach avoids the use of instrumental variables in a setting where instruments are frequently not available. We employ this methodology to estimate the returns to schooling for a sample of Australian workers. We find that accounting for the endogeneity of education in this manner increases the estimated return to education from 6 percent to 10 percent.
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Bibliographic InfoArticle provided by University of Wisconsin Press in its journal Journal of Human Resources.
Volume (Year): 44 (2009)
Issue (Month): 4 ()
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- Lídia Farré & Roger Klein & Francis Vella, 2013.
"A parametric control function approach to estimating the returns to schooling in the absence of exclusion restrictions: an application to the NLSY,"
Springer, vol. 44(1), pages 111-133, February.
- Farré, Lídia & Klein, Roger & Vella, Francis, 2010. "A Parametric Control Function Approach to Estimating the Returns to Schooling in the Absence of Exclusion Restrictions: An Application to the NLSY," IZA Discussion Papers 4935, Institute for the Study of Labor (IZA).
- Francis Vella & Lídia Farré & Roger Klein, 2008. "A Parametric Control Function Approach to Estimating the Returns to Schooling in the Absence of Exclusion Restrictions: An Application to the NLSY," Working Papers. Serie AD 2008-16, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Denny, Kevin & Oppedisano, Veruska, 2013. "The surprising effect of larger class sizes: Evidence using two identification strategies," Labour Economics, Elsevier, vol. 23(C), pages 57-65.
- Millimet, Daniel L. & Roy, Jayjit, 2011.
"Three New Empirical Tests of the Pollution Haven Hypothesis When Environmental Regulation is Endogenous,"
IZA Discussion Papers
5911, Institute for the Study of Labor (IZA).
- Daniel L. Millimet & Jayjit Roy, 2011. "Three New Empirical Tests of the Pollution Haven Hypothesis When Environmental Regulation is Endogenous," Working Papers 11-10, Department of Economics, Appalachian State University.
- Saniter, Nils, 2012. "Estimating Heterogeneous Returns to Education in Germany via Conditional Second Moments," Annual Conference 2012 (Goettingen): New Approaches and Challenges for the Labor Market of the 21st Century 62050, Verein für Socialpolitik / German Economic Association.
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