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Physician Income Expectations and Specialty Choice

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  • Sean Nicholson
  • Nicholas S. Souleles

Abstract

In spite of the important role of income expectations in economics, economists know little about how people actually form these expectations. We use a unique data set that contains the explicit income expectations of medical students over a 25-year time period to examine how students form income expectations. We examine whether students condition their expectations on their own ability, contemporaneous physician income, and the ex post income of physicians in their medical school cohort. We then test whether a model that uses the students' explicit income expectations to predict their specialty choices has a better fit than a model that assumes income expectations are formed statically, and a model that bases income expectations on ex post income.

Suggested Citation

  • Sean Nicholson & Nicholas S. Souleles, 2001. "Physician Income Expectations and Specialty Choice," NBER Working Papers 8536, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:8536
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    References listed on IDEAS

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    1. Willis, Robert J & Rosen, Sherwin, 1979. "Education and Self-Selection," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 7-36, October.
    2. Jeff Dominitz, 1998. "Earnings Expectations, Revisions, And Realizations," The Review of Economics and Statistics, MIT Press, vol. 80(3), pages 374-388, August.
    3. Das, Marcel & van Soest, Arthur, 1997. "Expected and realized income changes: Evidence from the Dutch socio-economic panel," Journal of Economic Behavior & Organization, Elsevier, vol. 32(1), pages 137-154, January.
    4. Charles F. Manski, 1993. "Adolescent Econometricians: How Do Youth Infer the Returns to Schooling?," NBER Chapters,in: Studies of Supply and Demand in Higher Education, pages 43-60 National Bureau of Economic Research, Inc.
    5. repec:tiu:tiutis:bdbe10dd-649c-4521-ab28-7aa051a5bf82 is not listed on IDEAS
    6. Frank A. Sloan, 1970. "Lifetime Earnings and Physicians' Choice of Specialty," ILR Review, Cornell University, ILR School, vol. 24(1), pages 47-56, October.
    7. Sean Nicholson, 2002. "Physician Specialty Choice under Uncertainty," Journal of Labor Economics, University of Chicago Press, vol. 20(4), pages 816-847, October.
    8. Julian R. Betts, 1996. "What Do Students Know about Wages? Evidence from a Survey of Undergraduates," Journal of Human Resources, University of Wisconsin Press, vol. 31(1), pages 27-56.
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    Citations

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    Cited by:

    1. Schweri, Juerg & Hartog, Joop & Wolter, Stefan C., 2011. "Do students expect compensation for wage risk?," Economics of Education Review, Elsevier, vol. 30(2), pages 215-227, April.
    2. Sean Nicholson, 2005. "How Much Do Medical Students Know About Physician Income?," Journal of Human Resources, University of Wisconsin Press, vol. 40(1).
    3. repec:eee:jeborg:v:141:y:2017:i:c:p:135-150 is not listed on IDEAS
    4. Schweri, Juerg & Hartog, Joop, 2014. "Do wage expectations influence the decision to enroll in nursing college?," Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100542, Verein für Socialpolitik / German Economic Association.
    5. Kristin J. Kleinjans & Jinkook Lee, 2006. "The link between individual expectations and savings: Do nursing home expectations matter?," Economics Working Papers 2006-05, Department of Economics and Business Economics, Aarhus University.
    6. Sean Nicholson & Nicholas S. Souleles, 2002. "Physician Income Prediction Errors: Sources and Implications for Behavior," NBER Working Papers 8907, National Bureau of Economic Research, Inc.
    7. Massimiliano BRATTI & Luca MANCINI, 2003. "Differences in Early Occupational Earnings of UK Male Graduates by Degree Subject: Evidence from the 1980-1993 USR," Working Papers 189, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    8. Mazza, Jacopo & van Ophem, Hans & Hartog, Joop, 2013. "Unobserved heterogeneity and risk in wage variance: Does more schooling reduce earnings risk?," Labour Economics, Elsevier, vol. 24(C), pages 323-338.
    9. Anchor, John R. & Fiserová, Jana & Mars[iota]ková, Katerina & Urbánek, Václav, 2011. "Student expectations of the financial returns to higher education in the Czech Republic and England: Evidence from business schools," Economics of Education Review, Elsevier, vol. 30(4), pages 673-681, August.
    10. Okeke, Edward N., 2013. "Brain drain: Do economic conditions “push” doctors out of developing countries?," Social Science & Medicine, Elsevier, vol. 98(C), pages 169-178.

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