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.
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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)
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