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A Test of the Sorting Model of Education in Australia

Author

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  • Paul W. Miller

    (UWA Business School, The University of Western Australia)

  • Charles Mulvey

    (UWA Business School, The University of Western Australia)

  • Nick Martin

    (Queensland Institute of Medical Research)

Abstract

In this paper we test the hypothesis advanced by Weiss (1995) that under sorting models the return to schooling across identical twins would decline over time compared to the return for the population as a whole. The analyses undertaken on a relatively large sample of Australian twins are consistent with this proposition. The pure effect of education on earnings declines with time in the labour market. This presumably occurs because with time in the labour market firms learn more about the workers and so can set pay assigning more weight to the information they acquire.

Suggested Citation

  • Paul W. Miller & Charles Mulvey & Nick Martin, 2004. "A Test of the Sorting Model of Education in Australia," Economics Discussion / Working Papers 04-12, The University of Western Australia, Department of Economics.
    • Handle: RePEc:uwa:wpaper:04-12
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    References listed on IDEAS

    as
    1. Miller, Paul & Mulvey, Charles & Martin, Nick, 1996. "Multiple Regression Analysis of the Occupational Status of Twins: A Comparison of Economic and Behavioural Genetics Models," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 58(2), pages 227-239, May.
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    5. Miller, Paul & Mulvey, Charles & Martin, Nick, 1997. "Family Characteristics and the Returns to Schooling: Evidence on Gender Differences from a Sample of Australian Twins," Economica, London School of Economics and Political Science, vol. 64(253), pages 119-136, February.
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    Cited by:

    1. Hornig, Stephan O. & Rottmann, Horst & Wapler, Rüdiger, 2011. "Sorting on the labour market: A literature overview and theoretical framework," Weidener Diskussionspapiere 27, University of Applied Sciences Amberg-Weiden (OTH).
    2. Yew Liang Lee & Paul W. Miller, 2004. "Screening and Human Capital in the Australian Labour Market of the 1990s," Australian Economic Papers, Wiley Blackwell, vol. 43(2), pages 117-135, June.
    3. Stephan O. Hornig & Horst Rottmann & Rüdiger Wapler, 2009. "Information Asymmetry, Education Signals and the Case of Ethnic and Native Germans," CESifo Working Paper Series 2683, CESifo Group Munich.
    4. Uschi Backes-Gellner & Stephan Veen, 2006. "Incentives for Schools, Educational Signals and Labour Market Outcomes," Economics of Education Working Paper Series 0009, University of Zurich, Department of Business Administration (IBW), revised Jun 2006.
    5. Miller, Paul & Mulvey, Charles & Martin, Nick, 2006. "The return to schooling: Estimates from a sample of young Australian twins," Labour Economics, Elsevier, vol. 13(5), pages 571-587, October.
    6. Oppedisano, Veruska, 2014. "Higher education expansion and unskilled labour market outcomes," Economics of Education Review, Elsevier, vol. 40(C), pages 205-220.

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