Rational Expectation and Education Rewarding: The Case of Chinese Off-Farm Wage Employment
AbstractThis study establishes a life-cycle model that a representative agent chooses optimal time of education to maximize his/her life earning, which implies that there may exist nonlinear relation between education and earning. Using the data of Chinese off-farm wage employment, we find that the duration of schooling years will increase by 1.7 years with 1 percent increase in rate of return to education. The empirical results also indicate that controversies about return to education might arise from model misspecification without consideration of nonlinearity and sample selection.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by European Association of Agricultural Economists in its series 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland with number 114530.
Date of creation: 2011
Date of revision:
return to schooling; life-cycle model; rational expectation; China; Labor and Human Capital; I20; J43; Q01;
Find related papers by JEL classification:
- I20 - Health, Education, and Welfare - - Education - - - General
- J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets
- Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-10-15 (All new papers)
- NEP-EDU-2011-10-15 (Education)
- NEP-HRM-2011-10-15 (Human Capital & Human Resource Management)
- NEP-LAB-2011-10-15 (Labour Economics)
- NEP-TRA-2011-10-15 (Transition Economics)
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.:
- Vincent Hogan & Ian Walker, 2003. "Education Choice under Uncertainty and Public Policy," Working Papers 200302, School Of Economics, University College Dublin.
- Russell Smyth & Qingguo Zhai & Xiaoxu Li, 2008.
"Determinants Of Turnover Intentions Among Chinese Off Farm Migrants,"
Development Research Unit Working Paper Series
03/08, Monash University, Department of Economics.
- Russell Smyth & Qingguo Zhai & Xiaoxu Li, 2009. "Determinants of turnover intentions among Chinese off farm migrants," Economic Change and Restructuring, Springer, vol. 42(3), pages 189-209, August.
- Benjamin, Dwayne, 1992. "Household Composition, Labor Markets, and Labor Demand: Testing for Separation in Agricultural Household Models," Econometrica, Econometric Society, vol. 60(2), pages 287-322, March.
- Ignacio Palacios-Huerta, 2003.
"An Empirical Analysis of the Risk Properties of Human Capital Returns,"
American Economic Review,
American Economic Association, vol. 93(3), pages 948-964, June.
- Ignacio Palacios-Huerta, 2001. "An Empirical Analysis of the Risk Properties of Human Capital Returns," Working Papers 2001-10, Brown University, Department of Economics.
- Zhang, Junsen & Zhao, Yaohui & Park, Albert & Song, Xiaoqing, 2005. "Economic returns to schooling in urban China, 1988 to 2001," Journal of Comparative Economics, Elsevier, vol. 33(4), pages 730-752, December.
- Heckman, James J, 1976. "A Life-Cycle Model of Earnings, Learning, and Consumption," Journal of Political Economy, University of Chicago Press, vol. 84(4), pages S11-44, August.
- Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 9.
- Levhari, David & Weiss, Yoram, 1974. "The Effect of Risk on the Investment in Human Capital," American Economic Review, American Economic Association, vol. 64(6), pages 950-63, December.
- Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
- Alan de Brauw & Scott Rozelle, 2008.
"Reconciling the Returns to Education in Off-Farm Wage Employment in Rural China,"
Review of Development Economics,
Wiley Blackwell, vol. 12(1), pages 57-71, 02.
- Alan de Brauw & Scott Rozelle, 2006. "Reconciling the Returns to Education in Off-FarmWage Employment in Rural China," Department of Economics Working Papers 2006-03, Department of Economics, Williams College.
- de Brauw, Alan & Huang, Jikun & Rozelle, Scott & Zhang, Linxiu & Zhang, Yigang, 2002.
"The Evolution Of China'S Rural Labor Markets During The Reforms,"
11984, University of California, Davis, Department of Agricultural and Resource Economics.
- de Brauw, Alan & Huang, Jikun & Rozelle, Scott & Zhang, Linxiu & Zhang, Yigang, 2002. "The Evolution of China's Rural Labor Markets During the Reforms," Journal of Comparative Economics, Elsevier, vol. 30(2), pages 329-353, June.
- Sherwin Rosen, 1992. "Distinguished Fellow: Mincering Labor Economics," Journal of Economic Perspectives, American Economic Association, vol. 6(2), pages 157-170, Spring.
- Jaeger, David A & Page, Marianne E, 1996. "Degrees Matter: New Evidence on Sheepskin Effects in the Returns to Education," The Review of Economics and Statistics, MIT Press, vol. 78(4), pages 733-40, November.
- Robert E. Lucas, Jr., 2004. "Life Earnings and Rural-Urban Migration," Journal of Political Economy, University of Chicago Press, vol. 112(S1), pages S29-S59, February.
- Taylor, J Edward & Rozelle, Scott & de Brauw, Alan, 2003. "Migration and Incomes in Source Communities: A New Economics of Migration Perspective from China," Economic Development and Cultural Change, University of Chicago Press, vol. 52(1), pages 75-101, October.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.