The effect of uncertain returns on human capital investment patterns
This paper formalizes a human capital model with a dynamic and uncertain rental rate of human capital. As a result, investment in human capital may no longer decline monotonically over time as is predicted by the standard Ben-Porath version of the human capital model. This model provides a plausible, theoretical explanation for the recent trend of investment in higher education later in the life cycle which is consistent with the empirically established, increasing returns to education. Copyright International Atlantic Economic Society 1998
Volume (Year): 26 (1998)
Issue (Month): 4 (December)
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Altonji, Joseph G, 1993.
"The Demand for and Return to Education When Education Outcomes Are Uncertain,"
Journal of Labor Economics,
University of Chicago Press, vol. 11(1), pages 48-83, January.
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