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The effects of educational choices on labor market, health, and social outcomes

Author

Listed:
  • James J. Heckman

    (University of Chicago, Department of Economics)

  • John Eric Humphries

    (University of Chicago, Department of Economics)

  • Sergio Urzua

    (University of Maryland, Department of Economics)

  • Gregory Veramendi

    (Aarhus University, School of Economics and Management)

Abstract

Using a sequential model of educational choices, we investigate the effect of educational choices on labor market, health, and social outcomes. Unobserved endowments drive the correlations in unobservables across choice and outcome equations. We proxy these endowments with numerous measurements and account for measurement error in the proxies. For each schooling level, we estimate outcomes for labor market, health, and social outcome. This allows us to generate counter-factual outcomes for dynamic choices and a variety of policy and treatment effects. In our framework, responses to treatment vary among observationally identical persons and agents may select into the treatment on the basis of their responses. We find important effects of early cognitive and socio-emotional abilities on schooling choices, labor market outcomes, adult health, and social outcomes. Education at most levels causally produces gains on labor market, health, and social outcomes. We estimate the distribution of responses to education and find substantial heterogeneity on which agents act.

Suggested Citation

  • James J. Heckman & John Eric Humphries & Sergio Urzua & Gregory Veramendi, 2010. "The effects of educational choices on labor market, health, and social outcomes," Working Papers 2011-002, Human Capital and Economic Opportunity Working Group.
    • Handle: RePEc:hka:wpaper:2011-002
    Note: ECI
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    File URL: http://humcap.uchicago.edu/RePEc/hka/wpaper/HHUV_2010_effect-edu-choice.pdf
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    References listed on IDEAS

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