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Ability, Educational Ranks, and Labor Market Trends: The Effects of Shifts in the Skill Composition of Educational Groups

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  • Dan T. Rosenbaum

Abstract

Large increases in educational attainment have resulted in dramatic shifts in the composition of educational groups. Utilizing the 1960-1990 Decennial Census and other data sources, I account for these changes in composition using educational ranks-cohort-specific relative rankings in educational attainment. For native white males, between 1969 and 1989 accounting for changes in the composition of educational groups (1) explains about half of the increase in the college/high school weekly earnings differential, (2) results in increases in weekly earnings for the less educated, and (3) doubles the increases in experience differentials for the high school graduates that are less educated. These findings raise questions about the common research strategy of using educational groups as a proxy for skill groups over long periods of time.

Suggested Citation

  • Dan T. Rosenbaum, 2000. "Ability, Educational Ranks, and Labor Market Trends: The Effects of Shifts in the Skill Composition of Educational Groups," JCPR Working Papers 146, Northwestern University/University of Chicago Joint Center for Poverty Research.
  • Handle: RePEc:wop:jopovw:146
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    References listed on IDEAS

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    1. Rebecca M. Blank & David Card & Philip K. Robins, 1999. "Financial Incentives for Increasing Work and Income Among Low- Income Families," HEW 9902002, EconWPA.
    2. Rebecca M. Blank & Alan S. Blinder, 1985. "Macroeconomics, Income Distribution, and Poverty," NBER Working Papers 1567, National Bureau of Economic Research, Inc.
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    Cited by:

    1. David Card & Thomas Lemieux, 2001. "Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis," The Quarterly Journal of Economics, Oxford University Press, vol. 116(2), pages 705-746.
    2. Ireland, Norman & Naylor, Robin A. & Smith, Jeremy & Telhaj, Shqiponja, 2009. "Educational returns, ability composition and cohort effects: theory and evidence for cohorts of early-career UK graduates," LSE Research Online Documents on Economics 28608, London School of Economics and Political Science, LSE Library.
    3. Charles A. Fleischman & Joshua H. Gallin, 2001. "Employment persistence," Finance and Economics Discussion Series 2001-25, Board of Governors of the Federal Reserve System (U.S.).
    4. Chinhui Juhn & Dae Il Kim & Francis Vella, 2005. "The Expansion of College Education in the United States: Is There Evidence of Declining Cohort Quality?," Economic Inquiry, Western Economic Association International, vol. 43(2), pages 303-315, April.
    5. Robert I. Lerman, 1999. "U.S. Wage-Inequality Trends and Recent Immigration," American Economic Review, American Economic Association, vol. 89(2), pages 23-28, May.
    6. Blom, Andreas & Holm-Nielsen, Lauritz & Verner, Dorte, 2001. "Education, earnings, and inequality in Brazil, 1982-98 - implications for education policy," Policy Research Working Paper Series 2686, The World Bank.
    7. Gregory Kurtzon, 2012. "Ability Composition Effects on the Education Premium," Working Papers 456, U.S. Bureau of Labor Statistics.
    8. Román Andrés Zárate, 2012. "Peer Effects, Cooperation and Competition in Human Capital Formation," DOCUMENTOS CEDE 009795, UNIVERSIDAD DE LOS ANDES-CEDE.

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