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The Value of U.S. College Education in Global Labor Markets: Experimental Evidence from China

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  • Mingyu Chen

    (Princeton University)

Abstract

One million international students study in the U.S. each year and the majority of them compete in global labor markets after graduation. I conduct a large-scale field experiment to study how employers in China value U.S. college education. I sent over 27,000 fictitious online applications to business and computer science jobs in China, randomizing the country of college education. I find that U.S.-educated applicants are on average 18 percent less likely to receive a callback than applicants educated in China, with applicants from very selective U.S. institutions underperforming those from the least selective Chinese institutions. The U.S.-China callback gap is smaller at high-wage jobs, consistent with employers fearing U.S.-educated applicants have better outside options and will be harder to hire and retain. The gap is also smaller at foreign-owned firms, consistent with Chinese-owned firms knowing less about American education. Controlling for high school quality, test scores, or U.S. work experiences does not attenuate the gap, suggesting that it is not driven by employer perceptions of negative selection. A companion employer survey of 260 hiring managers finds consistent and additional supporting evidence for the experimental findings.

Suggested Citation

  • Mingyu Chen, 2019. "The Value of U.S. College Education in Global Labor Markets: Experimental Evidence from China," Working Papers 627, Princeton University, Department of Economics, Industrial Relations Section..
  • Handle: RePEc:pri:indrel:627
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    References listed on IDEAS

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    1. Ran Abramitzky & Leah Platt Boustan & Katherine Eriksson, 2012. "Europe's Tired, Poor, Huddled Masses: Self-Selection and Economic Outcomes in the Age of Mass Migration," American Economic Review, American Economic Association, vol. 102(5), pages 1832-1856, August.
    2. Paolo Abarcar, "undated". "Do Employers Value Return Migrants? An Experiment on the Returns to Foreign Work Experience," Mathematica Policy Research Reports f8bc567166f04bbeb7f0c831b, Mathematica Policy Research.
    3. Amanda Agan & Sonja Starr, 2016. "Ban the Box, Criminal Records, and Statistical Discrimination: A Field Experiment," Natural Field Experiments 00539, The Field Experiments Website.
    4. Marianne Bertrand & Sendhil Mullainathan, 2004. "Are Emily and Greg More Employable Than Lakisha and Jamal? A Field Experiment on Labor Market Discrimination," American Economic Review, American Economic Association, vol. 94(4), pages 991-1013, September.
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    Cited by:

    1. Hou, Yue & Liu, Chuyu & Crabtree, Charles, 2020. "Anti-muslim bias in the Chinese labor market," Journal of Comparative Economics, Elsevier, vol. 48(2), pages 235-250.
    2. Chen, Mingyu & Howell, Jessica & Smith, Jonathan, 2023. "Best and brightest? The impact of student visa restrictiveness on who attends college in the US," Labour Economics, Elsevier, vol. 84(C).
    3. Catalina Amuedo‐Dorantes & Kevin Shih & Huanan Xu, 2023. "The implications of optional practical training reforms on international student enrollments and quality," Economic Inquiry, Western Economic Association International, vol. 61(2), pages 253-281, April.

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    More about this item

    Keywords

    Education; Labor;

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions

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