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The “Sheepskin Effects” of Canadian Credentials

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  • Hui, Taylor Shek-wai

Abstract

This paper re-examines the “sheepskin effects” of educational credentials in Canada using data from the 1996 Census and Survey of Labour and Income Dynamics. I found that the estimated credential effects are sensitive to specifications. Regressions analysis in the standard model may not be adequate to control for the workers’ productivity difference unrelated to the credentials. Particularly, the misspecification of the earnings equation and pooling sample might introduce biases into the estimates of credential effects. With carefully constructed comparison groups, the estimated sheepskin effects of a Bachelor’s degree are smaller than that reported in Ferrar and Riddell (2002).

Suggested Citation

  • Hui, Taylor Shek-wai, 2004. "The “Sheepskin Effects” of Canadian Credentials," MPRA Paper 17994, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:17994
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    References listed on IDEAS

    as
    1. Park, Jin Heum, 1999. "Estimation of sheepskin effects using the old and the new measures of educational attainment in the Current Population Survey," Economics Letters, Elsevier, vol. 62(2), pages 237-240, February.
    2. Habermalz, Steffen, 2003. "Job Matching and the Returns to Educational Signals," IZA Discussion Papers 726, Institute of Labor Economics (IZA).
    3. Jacob Mincer, 1962. "On-the-Job Training: Costs, Returns, and Some Implications," NBER Chapters, in: Investment in Human Beings, pages 50-79, National Bureau of Economic Research, Inc.
    4. James J. Heckman & Lance J. Lochner & Petra E. Todd, 2003. "Fifty Years of Mincer Earnings Regressions," NBER Working Papers 9732, National Bureau of Economic Research, Inc.
    5. Riley, John G, 1979. "Testing the Educational Screening Hypothesis," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 227-252, October.
    6. Harley Frazis, 2002. "Human capital, signaling, and the pattern of returns to education," Oxford Economic Papers, Oxford University Press, vol. 54(2), pages 298-320, April.
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    More about this item

    Keywords

    Post-secondary Education; Human Capital; Signaling Effects; Canada.;
    All these keywords.

    JEL classification:

    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • I20 - Health, Education, and Welfare - - Education - - - General
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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