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Post-secondary education in Canada: can ability bias explain the earnings gap between college and university graduates?

  • Vincenzo Caponi
  • Miana Plesca

Using the Canadian General Social Survey we compute returns to post-secondary education relative to high school. Unlike previous research using Canadian data, our data set allows us to control for ability selection into higher education. We find strong evidence of positive ability selection into all levels of post-secondary education for men and weaker positive selection for women. Since the ability selection is stronger for higher levels of education, particularly for university, the difference in returns between university and college or trades education decreases slightly after accounting for ability bias. However, a puzzling large gap persists, with university-educated men still earning over 20% more than men with college or trades education.

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Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 42 (2009)
Issue (Month): 3 (August)
Pages: 1100-1131

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Handle: RePEc:cje:issued:v:42:y:2009:i:3:p:1100-1131
Contact details of provider: Postal: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
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