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Mind the Gap? Estimating the Effects of Postponing Higher Education

  • Holmlund, Bertil

    ()

    (Department of Economics)

  • Liu, Qian

    ()

    (Department of Economics)

  • Nordström Skans, Oskar

    ()

    (Institute for Labour Market Policy Evaluation (IFAU))

This paper estimates the effects on earnings of “gap years” between high school and university enrollment. The effect is estimated by means of standard earnings functions augmented to account for gap years and a rich set of control variables using administrative Swedish data. We find that postponement of higher education is associated with a persistent and non-trivial earnings penalty. The main source of the persistent penalty appears to be the loss of work experience after studies. The reduction of lifetime earnings associated with two years postponement of higher education amounts to 40-50 percent of annual earnings at age 40.

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File URL: http://uu.diva-portal.org/smash/get/diva2:110999/FULLTEXT01.pdf
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Paper provided by Uppsala University, Department of Economics in its series Working Paper Series with number 2006:17.

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Length: 33 pages
Date of creation: 15 Aug 2006
Date of revision:
Publication status: Published in Oxford Economic Papers., 2008, pages 683-710.
Handle: RePEc:hhs:uunewp:2006_017
Contact details of provider: Postal:
Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden

Phone: + 46 18 471 25 00
Fax: + 46 18 471 14 78
Web page: http://www.nek.uu.se/
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  12. Nordström Skans, Oskar & Liljeberg, Linus, 2005. "Causal effects of subsidized career breaks," Working Paper Series 2005:17, IFAU - Institute for Evaluation of Labour Market and Education Policy.
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  14. Alan S Blinder & Yoram Weiss, 1974. "Human Capital and Labor Supply: A Synthesis," Working Papers 435, Princeton University, Department of Economics, Industrial Relations Section..
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  16. Audrey Light, 1995. "The Effects of Interrupted Schooling on Wages," Journal of Human Resources, University of Wisconsin Press, vol. 30(3), pages 472-502.
  17. Griliches, Zvi, 1980. " Schooling Interruption, Work While in School and the Returns from Schooling," Scandinavian Journal of Economics, Wiley Blackwell, vol. 82(2), pages 291-303.
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