Heterogeneous Economic Returns to Postsecondary Degrees: Evidence from Chile
AbstractWe analyze the economic returns to different postsecondary degrees in Chile. We posit a schooling decision model with unobserved ability, observed test scores and labor market outcomes. We benefit from administrative records to carry out our empirical strategy. Our results show positive average returns to postsecondary degrees, especially for five-year degrees. However, we also uncover a large fraction of individuals with realized negative net returns. Although psychic benefits of postsecondary education could rationalize this result, we argue this might also suggest that individuals lack information at the time schooling decisions are made. Finally, our findings illustrate the importance of allowing for heterogeneous treatment effects when making policy recommendations.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 18817.
Date of creation: Feb 2013
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Find related papers by JEL classification:
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
- I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
- I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-03-16 (All new papers)
- NEP-LAM-2013-03-16 (Central & South America)
- NEP-LMA-2013-03-16 (Labor Markets - Supply, Demand, & Wages)
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- Nora Lustig & Luis F. Lopez-Calva & Eduardo Ortiz-Juarez, 2013.
"Deconstructing the Decline in Inequality in Latin America,"
1314, Tulane University, Department of Economics.
- Lustig, Nora & Lopez-Calva, Luis F. & Ortiz-Juarez, Eduardo, 2013. "Deconstructing the decline in inequality in Latin America," Policy Research Working Paper Series 6552, The World Bank.
- Katja Maria Kaufmann & Matthias Messner & Alex Solis, 2013. "Returns to Elite Higher Education in the Marriage Market: Evidence from Chile," Working Papers 489, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
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