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The Returns to Medical School: Evidence from Admission Lotteries


  • Nadine Ketel
  • Edwin Leuven
  • Hessel Oosterbeek
  • Bas van der Klaauw


We exploit admission lotteries to estimate the returns to medical school in the Netherlands. Using data from up to 22 years after the lottery, we find that in every single year after graduation doctors earn at least 20 percent more than people who end up in their next-best occupation. Twenty-two years after the lottery the earnings difference is almost 50 percent. Only a small fraction of this difference can be attributed to differences in working hours and human capital investments. The returns do not vary with gender or ability, and shift the entire earnings distribution. (JEL D44, I11, I26, J24, J31, J44)

Suggested Citation

  • Nadine Ketel & Edwin Leuven & Hessel Oosterbeek & Bas van der Klaauw, 2016. "The Returns to Medical School: Evidence from Admission Lotteries," American Economic Journal: Applied Economics, American Economic Association, vol. 8(2), pages 225-254, April.
  • Handle: RePEc:aea:aejapp:v:8:y:2016:i:2:p:225-54 Note: DOI: 10.1257/app.20140506

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    References listed on IDEAS

    1. Anderson, Gary M. & Halcoussis, Dennis & Johnston, Linda & Lowenberg, Anton D., 2000. "Regulatory barriers to entry in the healthcare industry: the case of alternative medicine," The Quarterly Review of Economics and Finance, Elsevier, vol. 40(4), pages 485-502.
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    Cited by:

    1. Di Paolo, Antonio & Tansel, Aysit, 2017. "Analyzing Wage Differentials by Fields of Study: Evidence from Turkey," GLO Discussion Paper Series 91, Global Labor Organization (GLO).
    2. repec:iza:izawol:journl:y:2017:n:392 is not listed on IDEAS

    More about this item

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • 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
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations


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