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The Role of Ability in Estimating the Returns to College Choice: New Swedish Evidence

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  • Eliasson, Kent

    (National Institute for Working Life)

Abstract

This paper examines the effect on earnings of graduating from five different college groups. The study is based on an administrative data set unusually rich in terms of school grades, parental characteristics and other attributes. Contrary to most previous Swedish research, we find no systematic differences in estimated earnings between the college categories. This finding holds for all college graduates, for men and women separately and for graduates in two specific fields of education. The results indicate that an estimator of the earnings effects of college choice that does not properly adjust for ability is likely to be substantially biased.

Suggested Citation

  • Eliasson, Kent, 2006. "The Role of Ability in Estimating the Returns to College Choice: New Swedish Evidence," Umeå Economic Studies 691, Umeå University, Department of Economics.
    • Handle: RePEc:hhs:umnees:0691
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    Cited by:

    1. Suhonen, Tuomo, 2013. "Are there returns from university location in a state-funded university system?," Regional Science and Urban Economics, Elsevier, vol. 43(3), pages 465-478.
    2. Ahlin, Lina & Andersson, Martin & Thulin, Per, 2016. "Human Capital Sorting - the ‘when’ and ‘who’ of sorting of talents to urban regions," Working Paper Series in Economics and Institutions of Innovation 430, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
    3. Kent Eliasson & Olle Westerlund, 2023. "The urban wage premium and spatial sorting on observed and unobserved ability," Journal of Economic Geography, Oxford University Press, vol. 23(3), pages 601-627.
    4. Tuomo Suhonen, 2014. "Quality of higher education and earnings: evidence from Finland using field-of-study-level quality measures," International Review of Applied Economics, Taylor & Francis Journals, vol. 28(1), pages 22-44, January.
    5. Eliasson, Kent, 2006. "How Robust is the Evidence on the Returns to College Choice? Results Using Swedish Administrative Data," Umeå Economic Studies 692, Umeå University, Department of Economics.
    6. Eliasson, Kent, 2006. "College Choice And Earnings Among University Graduates In Sweden," Umeå Economic Studies 693, Umeå University, Department of Economics.
    7. Kent Eliasson & Olle Westerlund, 2023. "The urban wage premium and spatial sorting on observed and unobserved ability," Journal of International Economic Law, Oxford University Press, vol. 23(3), pages 601-627.

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    More about this item

    Keywords

    College choice; ability; earnings; selection on observables;
    All these keywords.

    JEL classification:

    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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