Are Returns to Schooling Concentrated Among the Most Able? A Semiparametric Analysis of the Ability-Earnings Relationships
In this paper, I explore the ability-earnings relationships semiparametrically. I find evidence of nonlinearities in these relationships which vary across levels of schooling, and argue that ability-sorting into higher education creates problems for accurately identifying the return to schooling over the full ability support. Over an ability support which is ``common'' to those with and without a college education, we find that the college log wage premium is increasing for the more able, and this premium grew during the period 1984-1994 for individuals at all points in the ability distribution. Further, the growth of this wage premium appears to have followed a ``smoother'' path for high-ability individuals than individuals of lower ability.
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|Date of creation:||01 Jan 2001|
|Date of revision:|
|Publication status:||Published in OXFORD BULLETIN OF ECONOMICS AND STATISTICS 2001, vol. 61, pp. 1-29|
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