The coexistence of Degree-Premium and High-Dropout Rates in the Uruguayan Secondary Education: an Incentives Problem
Although participation rates in the educational system might look impressive for a Latin American country, educational outputs are not that great. Uruguay is characterized by educational gaps and high drop-out rates in the secondary education. In our work we first explore the returns to schooling in Uruguay. In the course of our analysis, we use quantile regression models that are more suitable than ordinary least squares (OLS) for countries where heterogeneity within the labour force in terms of earnings and the impact of individual characteristics on earnings is significant. In particular we test the hypothesis of the existence of a degree premium for those individuals that complete the secondary education (12 years of education). As we find evidence that allows us to confirm the existence of the degree premium, we make conjectures and present a possible explanation that links the evidence between the existence of degree premium, educational gaps and dropouts. The rationale is that since only the completion of the secondary degree will generate a clear economic benefit, many individuals will exit the educational system as they find difficulties in the transit along the secondary level. In other words, the completion of the entire secondary stage might be seen as a long haul race and Uruguayan youngsters end up exiting the process when they are still far from the end. To cope with the estimation problem of unobservable household or children characteristics, this investigation employs an instrumental variable (IV) strategy both for two-stage least squares (TSLS) and quantile regression (QTE).
|Date of creation:||2010|
|Date of revision:|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Omar Arias & Kevin F. Hallock & Walter Sosa Escudero, 1999.
"Individual Heterogeneity in the Returns to Schooling: Instrumental Variables Quantile Regression using Twins Data,"
Department of Economics, Working Papers
016, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata.
- Omar Arias & Walter Sosa-Escudero & Kevin F. Hallock, 2001. "Individual heterogeneity in the returns to schooling: instrumental variables quantile regression using twins data," Empirical Economics, Springer, vol. 26(1), pages 7-40.
- Samuel Berlinski & Sebastian Galiani & Marco Manacorda, 2006.
"Giving children a better start: preschool attendance and school-age profiles,"
IFS Working Papers
W06/18, Institute for Fiscal Studies.
- Berlinski, Samuel & Galiani, Sebastian & Manacorda, Marco, 2008. "Giving children a better start: Preschool attendance and school-age profiles," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1416-1440, June.
- Samuel Berlinski & Sebastian Galiani & Marco Manacorda, 2007. "Giving Children a Better Start: Preschool Attendance and School-Age Profiles," Working Papers 618, Queen Mary University of London, School of Economics and Finance.
- Berlinski, Samuel & Galiani, Sebastian & Manacorda, Marco, 2007. "Giving children a better start : preschool attendance and school-age profiles," Policy Research Working Paper Series 4240, The World Bank.
- Markus Frolich & Blaise Melly, 2010. "Estimation of quantile treatment effects with Stata," Stata Journal, StataCorp LP, vol. 10(3), pages 423-457, September.
- Roger Koenker & Kevin F. Hallock, 2001.
Journal of Economic Perspectives,
American Economic Association, vol. 15(4), pages 143-156, Fall.
- Alberto Abadie & Joshua Angrist & Guido Imbens, 2002.
"Instrumental Variables Estimates of the Effect of Subsidized Training on the Quantiles of Trainee Earnings,"
Econometric Society, vol. 70(1), pages 91-117, January.
- Alberto Abadie & Joshua Angrist & Guido Imbens, 1999. "Instrumental Variables Estimates of the Effect of Subsidized Training on the Quantiles of Trainee Earnings," Working papers 99-16, Massachusetts Institute of Technology (MIT), Department of Economics.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:39912. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter)
If references are entirely missing, you can add them using this form.