Returns to Education
This study gives an account of theory, models and measurements of returns to higher education, seen as the results of economically rational investment decisions. The focus is on returns in the form of increased wages and salaries. These returns vary considerably between different countries and tend to be considerably larger in the USA than in western Europe. One of the reasons for these differences in returns may be the differences in systems of funding of higher education. It is claimed that practically all studies of returns to investments in higher education disregard the benefits from reductions in consumer transaction costs and the role played by education as an important input in household production functions. Econometric studies, reported in the paper, accordingly indicate that the level of education has a considerable impact on the structure of household consumption expenditures.
|Date of creation:||28 Jan 2009|
|Date of revision:|
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- Robert H. Haveman & Barbara L. Wolfe, 1984. "Schooling and Economic Well-Being: The Role of Nonmarket Effects," Journal of Human Resources, University of Wisconsin Press, vol. 19(3), pages 377-407.
- Jones, Patricia, 2001. "Are educated workers really more productive?," Journal of Development Economics, Elsevier, vol. 64(1), pages 57-79, February.
- Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
- Ichino, Andrea & Winter-Ebmer, Rudolf, 1999.
"Lower and upper bounds of returns to schooling: An exercise in IV estimation with different instruments,"
European Economic Review,
Elsevier, vol. 43(4-6), pages 889-901, April.
- Ichino, Andrea & Winter-Ebmer, Rudolf, 1998. "Lower and Upper Bounds of Returns to Schooling: An Exercise in IV estimation with Different Instruments," CEPR Discussion Papers 2007, C.E.P.R. Discussion Papers.
- Weale, Martin, 1993. "A Critical Evaluation of Rate of Return Analysis," Economic Journal, Royal Economic Society, vol. 103(418), pages 729-37, May.
- Miller, Paul W & Mulvey, Charles & Martin, Nick, 1995. "What Do Twins Studies Reveal about the Economic Returns to Education? A Comparison of Australian and U.S. Findings," American Economic Review, American Economic Association, vol. 85(3), pages 586-99, June.
- Colm Harmon & Ian Walker, 1995.
"Estimates of the economic return to schooling for the United Kingdom,"
Open Access publications
10197/647, School of Economics, University College Dublin.
- Harmon, Colm & Walker, Ian, 1995. "Estimates of the Economic Return to Schooling for the United Kingdom," American Economic Review, American Economic Association, vol. 85(5), pages 1278-86, December.
- David Card, 2000.
"Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems,"
NBER Working Papers
7769, National Bureau of Economic Research, Inc.
- Card, David, 2001. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," Econometrica, Econometric Society, vol. 69(5), pages 1127-60, September.
- Isacsson, Gunnar, 1999. "Estimates of the return to schooling in Sweden from a large sample of twins," Labour Economics, Elsevier, vol. 6(4), pages 471-489, November.
- Alan Krueger & Orley Ashenfelter, 1992.
"Estimates of the Economic Return to Schooling from a New Sample of Twins,"
NBER Working Papers
4143, National Bureau of Economic Research, Inc.
- Ashenfelter, Orley & Krueger, Alan B, 1994. "Estimates of the Economic Returns to Schooling from a New Sample of Twins," American Economic Review, American Economic Association, vol. 84(5), pages 1157-73, December.
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