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Characterizing the Returns to STEM: Marginal and Policy-Relevant Treatment Effects

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  • Aderonke Osikominu
  • Gregor Pfeifer
  • Tim Ruberg

Abstract

We estimate heterogeneous returns to STEM education by leveraging relative distances to technical versus general universities in Switzerland. While individuals who choose a STEM education gain on average, a declining marginal treatment effect curve indicates positive selection on gains, suggesting that low-resistance individuals benefit the most. Through policy simulations aimed at increasing STEM enrollment and estimating corresponding policy-relevant treatment effects, we demonstrate that these policies' effectiveness critically depends on both observable and unobservable characteristics of affected individuals. Furthermore, we highlight how policies should be designed to both increase STEM enrollment and generate positive returns for targeted groups, particularly women.

Suggested Citation

  • Aderonke Osikominu & Gregor Pfeifer & Tim Ruberg, 2026. "Characterizing the Returns to STEM: Marginal and Policy-Relevant Treatment Effects," RFBerlin Discussion Paper Series 26160, ROCKWOOL Foundation Berlin (RFBerlin).
    • Handle: RePEc:crm:wpaper:26160
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    Keywords

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    JEL classification:

    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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