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Whose Investments in Higher Education Have Been Most Influenced by Labor Market Conditions in Recent Decades?

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  • Jiang, Dezhi

Abstract

Theoretically, high school graduates are more likely to enroll in college during periods of unfavorable labor market conditions because of a lower opportunity cost. However, how this causal relationship has varied in recent decades (from the 1980s to the 2010s), and how the gender and race heterogeneity of this causal effect differs over time are open empirical questions. This research utilizes continuity and a large sample size of the IPUMS Current Population Survey (IPUMS CPS) and finds the causal relationship has increased in recent decades. The estimates also show that the educational decisions of men are generally more sensitive to current labor market conditions than those made by women, but the gap between the sexes is diminishing. Further, the impact of labor market conditions on educational decisions is heterogeneous across race and ethnicity groups as some have been more influenced than others during some decades. Moreover, this research explores a way to use the new information from each year’s CPS October Education Supplement survey to update the estimates of this causal effect and compare the estimates to studies using the cohort survey or administrative data.

Suggested Citation

  • Jiang, Dezhi, 2021. "Whose Investments in Higher Education Have Been Most Influenced by Labor Market Conditions in Recent Decades?," SocArXiv 83upm, Center for Open Science.
    • Handle: RePEc:osf:socarx:83upm
    DOI: 10.31219/osf.io/83upm
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