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The role of mathematical and verbal skills on the returns to graduate and professional education


  • Song, Moohoun
  • Orazem, Peter F.
  • Wohlgemuth, Darin


Students in majors with higher average quantitative graduate records exam (GRE) scores are less likely to attend graduate school whereas students in majors with higher average verbal GRE scores are more likely to attend graduate school. This sorting effect means that students whose cognitive skills are associated with lower earnings at the bachelor's level are the most likely to attend graduate school. As a result, there is a substantial downward bias in estimated returns to graduate education. Correcting for the sorting effect raises estimated annualized returns to a Master's or doctoral degree from about 5% to 7.3% and 12.8%, respectively. Estimated returns to professional degrees rise from 13.9% to 16.6%. These findings correspond to a large increase in relative earnings received by postgraduate degree holders in the United States over the past 20 years.

Suggested Citation

  • Song, Moohoun & Orazem, Peter F. & Wohlgemuth, Darin, 2008. "The role of mathematical and verbal skills on the returns to graduate and professional education," Economics of Education Review, Elsevier, vol. 27(6), pages 664-675, December.
  • Handle: RePEc:eee:ecoedu:v:27:y:2008:i:6:p:664-675

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    References listed on IDEAS

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    Cited by:

    1. Fumihiko SUGA, 2017. "The Returns to Postgraduate Education," ESRI Discussion paper series 336, Economic and Social Research Institute (ESRI).
    2. Park, Seonyoung, 2011. "Returning to school for higher returns," Economics of Education Review, Elsevier, vol. 30(6), pages 1215-1228.
    3. Fan, Jing-bo & Zhang, Cheng-gang, 2015. "A study of the rate of return to higher engineering education in China," International Journal of Educational Development, Elsevier, vol. 42(C), pages 106-114.

    More about this item


    Postgraduate Rate of return Demand for schooling Quantitative skills Qualitative skills Sorting;

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General


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