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The Screening Hypothesis and the Returns to Schooling in Argentina

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  • Harry Anthony Patrinos

    () (World Bank)

  • Maria Paula Savanti

    ()

Abstract

We conduct four tests of screening in education. We apply our methodology to labor market data from Argentina, using two points in time, a period during which the returns to schooling in Argentina increased. There do not appear to be significant increases associated with years of schooling that would represent the attainment of a primary or secondary certificate. The only signal that there might be screening occurs at 17 years of schooling which could be argued represents the attainment of a tertiary education degree. However, 15 years of schooling also represents a significant threshold in 2002. The returns to schooling are higher in the private sector. Much of the increase in the returns to schooling overall is due to the increase in the returns to tertiary education. The returns to complete university are higher in the private sector. This provides no evidence of screening since the private sector seeks to maximize profits and recognizes the higher productivity of the more educated. Overall, there is little evidence of screening driving the returns to schooling.

Suggested Citation

  • Harry Anthony Patrinos & Maria Paula Savanti, 2014. "The Screening Hypothesis and the Returns to Schooling in Argentina," Research in Applied Economics, Macrothink Institute, vol. 6(3), pages 28-42, September.
  • Handle: RePEc:mth:raee88:v:6:y:2014:i:3:p:28-42
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    References listed on IDEAS

    as
    1. Jhon James Mora, 2003. "Sheepskin effects and screening in Colombia," Colombian Economic Journal, Universidad Nacional de Colombia -FCE - CID, April.
      • Jhon James Mora, 2003. "Sheepskin effects and screening in Colombia," Colombian Economic Journal, Academia Colombiana de Ciencias Economicas, Colegio Mayor de Nuestra Senora del Rosario, Pontificia Universidad Javeriana, Universidad de Antioquia, Universidad de los Andes, Universidad del Valle, Universidad Externado de Colombia, Universidad Nacional de Colombia, vol. 1(1), pages 95-108, December.
    2. Norbert R. Schady, 2003. "Convexity and Sheepskin Effects in the Human Capital Earnings Function: Recent Evidence for Filipino Men," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 65(2), pages 171-196, May.
    3. Layard, Richard & Psacharopoulos, George, 1974. "The Screening Hypothesis and the Returns to Education," Journal of Political Economy, University of Chicago Press, vol. 82(5), pages 985-998, Sept./Oct.
    4. Brown, Sarah & Sessions, John G., 1999. "Education and employment status: a test of the strong screening hypothesis in Italy," Economics of Education Review, Elsevier, vol. 18(4), pages 397-404, October.
    5. Skalli, Ali, 2007. "Are successive investments in education equally worthwhile? Endogenous schooling decisions and non-linearities in the earnings-schooling relationship," Economics of Education Review, Elsevier, vol. 26(2), pages 215-231, April.
    6. Galiani, Sebastian & Sanguinetti, Pablo, 2003. "The impact of trade liberalization on wage inequality: evidence from Argentina," Journal of Development Economics, Elsevier, vol. 72(2), pages 497-513, December.
    7. Arrow, Kenneth J., 1973. "Higher education as a filter," Journal of Public Economics, Elsevier, vol. 2(3), pages 193-216, July.
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