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Returns to Schooling: A Peculiar Deviation from Linearity

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  • Jin Huem Park

    (Princeton University)

Abstract

Results reported in this paper indicate that the returns-to-schooling profile exhibits a peculiar departure from log-linearity. In particular, for white males, the return to the 15th year of schooling (the third year of college) seems to be much smaller than that predicted by log-linearity. That is, people with 15 years of schooling do not appear to earn any more than those with 14 years of schooling. I discuss several theories and evidence that may explain the peculiarity. Amongst them, measurement error in schooling seems the most plausible.

Suggested Citation

  • Jin Huem Park, 1994. "Returns to Schooling: A Peculiar Deviation from Linearity," Working Papers 714, Princeton University, Department of Economics, Industrial Relations Section..
  • Handle: RePEc:pri:indrel:335
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    Citations

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    Cited by:

    1. Norbert R. Schady, 2003. "Convexity and Sheepskin Effects in the Human Capital Earnings Function: Recent Evidence for Filipino Men," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 65(2), pages 171-196, May.
    2. Thomas J. Kane & Cecilia Elena Rouse & Douglas Staiger, 1999. "Estimating Returns to Schooling When Schooling is Misreported," NBER Working Papers 7235, National Bureau of Economic Research, Inc.
    3. Angel de la Fuente & Antonio Ciccone, 2003. "Human capital in a global and knowledge-based economy," UFAE and IAE Working Papers 562.03, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    4. Moura, Rodrigo Leandro, 2008. "Testando as Hipóteses do Modelo de Mincer para o Brasil," Revista Brasileira de Economia - RBE, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil), vol. 62(4), December.
    5. 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.
    6. Orley Ashenfelter & Cecilia Rouse, 1998. "Income, Schooling, and Ability: Evidence from a New Sample of Identical Twins," The Quarterly Journal of Economics, Oxford University Press, vol. 113(1), pages 253-284.
    7. Park, Seonyoung, 2011. "Returning to school for higher returns," Economics of Education Review, Elsevier, vol. 30(6), pages 1215-1228.
    8. Mikael Lindahl & Alan B. Krueger, 2001. "Education for Growth: Why and for Whom?," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1101-1136, December.
    9. David Card, 1994. "Earnings, Schooling, and Ability Revisited," Working Papers 710, Princeton University, Department of Economics, Industrial Relations Section..
    10. David Card & Alan B. Krueger, 1996. "Labor Market Effects of School Quality: Theory and Evidence," NBER Working Papers 5450, National Bureau of Economic Research, Inc.
    11. Balestra, Simone & Backes-Gellner, Uschi, 2017. "Heterogeneous returns to education over the wage distribution: Who profits the most?," Labour Economics, Elsevier, vol. 44(C), pages 89-105.
    12. Marta Sanmartin, 2001. "Linearity of the return to education and self selection," Applied Economics, Taylor & Francis Journals, vol. 33(1), pages 133-142.
    13. Pamela Giustinelli, 2004. "Quantile Regression Evidence on Italian Education Returns," Rivista di Politica Economica, SIPI Spa, vol. 94(6), pages 49-100, November-.
    14. Kyle Glenn, 2021. "Social Labor vs Human Capital: Competing Theories of Skills," Working Papers 2115, New School for Social Research, Department of Economics.
    15. Claudio Sapelli., 2009. "Los Retornos a la Educación en Chile: Estimaciones por Corte Transversal y por Cohortes," Documentos de Trabajo 349, Instituto de Economia. Pontificia Universidad Católica de Chile..
    16. Alan B. Krueger & Mikael Lindahl, 1998. "Education for Growth in Sweden and the World," Working Papers 790, Princeton University, Department of Economics, Industrial Relations Section..
    17. Krzysztof Kalisiak & Małgorzata Szreder & Kaja Białowąs, 2011. "Finansowy i niefinansowy zwrot z edukacji," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 9, pages 77-102.

    More about this item

    Keywords

    wage level and structure; wage differentials by skill; training; occupation;
    All these keywords.

    JEL classification:

    • A31 - General Economics and Teaching - - Multisubject Collective Works - - - Multisubject Collected Writings of Individuals

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