IDEAS home Printed from https://ideas.repec.org/p/zbw/vfsc14/100542.html

Do wage expectations influence the decision to enroll in nursing college?

Author

Listed:
  • Schweri, Juerg
  • Hartog, Joop

Abstract

Given a severe nurse shortage in Switzerland, this paper investigates Swiss students choice for nursing college education and the impact of their ex ante wage expectations on college enrolment. The analysis contributes to a small developing literature that uses subjective wage expectation data to predict education choice. We surveyed a full cohort of healthcare trainees on upper-secondary level in their third year of training. The main result is that trainees who expected a lower starting wage when working as healthcare employee were more likely to enroll in a nursing college later on. This result suggests a role for policies that increase returns from studying nursing to attract students to nursing. In addition, the result confirms that subjective wage expectation data is useful in modeling individual choice.

Suggested Citation

  • Schweri, Juerg & Hartog, Joop, 2014. "Do wage expectations influence the decision to enroll in nursing college?," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100542, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc14:100542
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/100542/1/VfS_2014_pid_386.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    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. Heyes, Anthony, 2005. "The economics of vocation or 'why is a badly paid nurse a good nurse'?," Journal of Health Economics, Elsevier, vol. 24(3), pages 561-569, May.
    3. Chiha, Yvana A. & Link, Charles R., 2003. "The shortage of registered nurses and some new estimates of the effects of wages on registered nurses labor supply: a look at the past and a preview of the 21st century," Health Policy, Elsevier, vol. 64(3), pages 349-375, June.
    4. Stefan C. Wolter, 2000. "Wage Expectations: A Comparison of Swiss and US Students," Kyklos, Wiley Blackwell, vol. 53(1), pages 51-69, February.
    5. John Mullahy, 2010. "Multivariate Fractional Regression Estimation of Econometric Share Models," NBER Working Papers 16354, National Bureau of Economic Research, Inc.
    6. Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde & Jürgen Schupp & Gert G. Wagner, 2011. "Individual Risk Attitudes: Measurement, Determinants, And Behavioral Consequences," Journal of the European Economic Association, European Economic Association, vol. 9(3), pages 522-550, June.
    7. Di Tommaso, M.L. & Strøm, S. & Sæther, E.M., 2009. "Nurses wanted: Is the job too harsh or is the wage too low?," Journal of Health Economics, Elsevier, vol. 28(3), pages 748-757, May.
    8. Xiaohao Ding & Joop Hartog & Yuze Sun, 2010. "Can we measure Individual Risk Attitudes in a Survey?," Tinbergen Institute Discussion Papers 10-027/3, Tinbergen Institute.
    9. Spetz, Joanne, 2002. "The value of education in a licensed profession: the choice of associate or baccalaureate degrees in nursing," Economics of Education Review, Elsevier, vol. 21(1), pages 73-85, February.
    10. Christian Belzil & Jörgen Hansen, 2002. "Unobserved Ability and the Return to Schooling," Econometrica, Econometric Society, vol. 70(5), pages 2075-2091, September.
    11. Basit Zafar, 2011. "Can subjective expectations data be used in choice models? evidence on cognitive biases," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(3), pages 520-544, April.
    12. Hirsch, Barry T. & Schumacher, Edward J., 1995. "Monopsony power and relative wages in the labor market for nurses," Journal of Health Economics, Elsevier, vol. 14(4), pages 443-476, October.
    13. Steven Simoens & Mike Villeneuve & Jeremy Hurst, 2005. "Tackling Nurse Shortages in OECD Countries," OECD Health Working Papers 19, OECD Publishing.
    14. Heyes, Anthony G., 2007. "Optimal wages in the market for nurses," Journal of Health Economics, Elsevier, vol. 26(5), pages 1031-1033, September.
    15. Arcidiacono, Peter & Hotz, V. Joseph & Maurel, Arnaud & Romano, Teresa, 2014. "Recovering Ex Ante Returns and Preferences for Occupations using Subjective Expectations Data," IZA Discussion Papers 8549, IZA Network @ LISER.
    16. Elliott, Robert F. & Ma, Ada H.Y. & Scott, Anthony & Bell, David & Roberts, Elizabeth, 2007. "Geographically differentiated pay in the labour market for nurses," Journal of Health Economics, Elsevier, vol. 26(1), pages 190-212, January.
    17. Stacey H. Chen, 2008. "Estimating the Variance of Wages in the Presence of Selection and Unobserved Heterogeneity," The Review of Economics and Statistics, MIT Press, vol. 90(2), pages 275-289, May.
    18. Webbink, Dinand & Hartog, Joop, 2004. "Can students predict starting salaries? Yes!," Economics of Education Review, Elsevier, vol. 23(2), pages 103-113, April.
    19. Keane, Michael P & Wolpin, Kenneth I, 1997. "The Career Decisions of Young Men," Journal of Political Economy, University of Chicago Press, vol. 105(3), pages 473-522, June.
    20. John Jerrim, 2011. "Do UK Higher Education Students Overestimate Their Starting Salary?," Fiscal Studies, Institute for Fiscal Studies, vol. 32(4), pages 483-509, December.
    21. Basit Zafar, 2011. "How Do College Students Form Expectations?," Journal of Labor Economics, University of Chicago Press, vol. 29(2), pages 301-348.
    22. Botelho, Anabela & Pinto, Ligia Costa, 2004. "Students' expectations of the economic returns to college education: results of a controlled experiment," Economics of Education Review, Elsevier, vol. 23(6), pages 645-653, December.
    23. Freeman, James A. & Hirsch, Barry T., 2008. "College majors and the knowledge content of jobs," Economics of Education Review, Elsevier, vol. 27(5), pages 517-535, October.
    24. 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.
    25. Filippin, Antonio & Ichino, Andrea, 2005. "Gender wage gap in expectations and realizations," Labour Economics, Elsevier, vol. 12(1), pages 125-145, February.
    26. Flavio Cunha & James Heckman & Salvador Navarro, 2005. "Separating uncertainty from heterogeneity in life cycle earnings," Oxford Economic Papers, Oxford University Press, vol. 57(2), pages 191-261, April.
    27. Surrey Walton & Philip Graves & Robert Sexton, 2005. "New Entry and the Rate of Return to Education: The Case of Registered Nurses," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 33(3), pages 325-336, September.
    28. Taylor, Lowell J., 2007. "Optimal wages in the market for nurses: An analysis based on Heyes' model," Journal of Health Economics, Elsevier, vol. 26(5), pages 1027-1030, September.
    29. Shields, Michael A. & Ward, Melanie, 2001. "Improving nurse retention in the National Health Service in England: the impact of job satisfaction on intentions to quit," Journal of Health Economics, Elsevier, vol. 20(5), pages 677-701, September.
    30. Douglas O. Staiger & Joanne Spetz & Ciaran S. Phibbs, 2010. "Is There Monopsony in the Labor Market? Evidence from a Natural Experiment," Journal of Labor Economics, University of Chicago Press, vol. 28(2), pages 211-236, April.
    31. Wilbert van der Klaauw, 2012. "On the Use of Expectations Data in Estimating Structural Dynamic Choice Models," Journal of Labor Economics, University of Chicago Press, vol. 30(3), pages 521-554.
    32. Charles F. Manski, 2004. "Measuring Expectations," Econometrica, Econometric Society, vol. 72(5), pages 1329-1376, September.
    33. Magali Beffy & Denis Fougère & Arnaud Maurel, 2012. "Choosing the Field of Study in Postsecondary Education: Do Expected Earnings Matter?," The Review of Economics and Statistics, MIT Press, vol. 94(1), pages 334-347, February.
    34. Sean Nicholson, 2005. "How Much Do Medical Students Know About Physician Income?," Journal of Human Resources, University of Wisconsin Press, vol. 40(1).
    35. 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.
    36. Joop Hartog & Xiaohao Ding & Juan Liao, 2014. "Is earnings uncertainty relevant for educational choice? An empirical analysis for China," Education Economics, Taylor & Francis Journals, vol. 22(5), pages 471-483, October.
    37. Arcidiacono, Peter & Hotz, V. Joseph & Kang, Songman, 2012. "Modeling college major choices using elicited measures of expectations and counterfactuals," Journal of Econometrics, Elsevier, vol. 166(1), pages 3-16.
    38. Montmarquette, Claude & Cannings, Kathy & Mahseredjian, Sophie, 2002. "How do young people choose college majors?," Economics of Education Review, Elsevier, vol. 21(6), pages 543-556, December.
    39. Basit Zafar, 2013. "College Major Choice and the Gender Gap," Journal of Human Resources, University of Wisconsin Press, vol. 48(3), pages 545-595.
    40. Emanuela Antonazzo & Anthony Scott & Diane Skatun & Robert. F. Elliott, 2003. "The labour market for nursing: a review of the labour supply literature," Health Economics, John Wiley & Sons, Ltd., vol. 12(6), pages 465-478, June.
    41. Ralph Stinebrickner & Todd R. Stinebrickner, 2014. "A Major in Science? Initial Beliefs and Final Outcomes for College Major and Dropout," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 81(1), pages 426-472.
    42. Ding, Xiaohao & Hartog, Joop & Sun, Yuze, 2010. "Can We Measure Individual Risk Attitudes in a Survey?," IZA Discussion Papers 4807, IZA Network @ LISER.
    43. Kodde, David A, 1986. "Uncertainty and the Demand for Education," The Review of Economics and Statistics, MIT Press, vol. 68(3), pages 460-467, August.
    44. 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.
    45. Shane Frederick & George Loewenstein & Ted O'Donoghue, 2002. "Time Discounting and Time Preference: A Critical Review," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 351-401, June.
    46. Jan Erik Askildsen & Badi H. Baltagi & Tor Helge Holmås, 2003. "Wage policy in the health care sector: a panel data analysis of nurses' labour supply," Health Economics, John Wiley & Sons, Ltd., vol. 12(9), pages 705-719, September.
    47. Hanel, Barbara & Kalb, Guyonne & Scott, Anthony, 2014. "Nurses’ labour supply elasticities: The importance of accounting for extensive margins," Journal of Health Economics, Elsevier, vol. 33(C), pages 94-112.
    48. Francesca Barigozzi & Gilberto Turati, 2012. "Human health care and selection effects. Understanding labor supply in the market for nursing," Health Economics, John Wiley & Sons, Ltd., vol. 21(4), pages 477-483, April.
    49. Menon, Maria Eliophotou, 2008. "Perceived rates of return to higher education: Further evidence from Cyprus," Economics of Education Review, Elsevier, vol. 27(1), pages 39-47, February.
    50. Michael A. Shields, 2004. "Addressing nurse shortages: what can policy makers learn from the econometric evidence on nurse labour supply?," Economic Journal, Royal Economic Society, vol. 114(499), pages 464-498, November.
    51. Sean Nicholson & Nicholas S. Souleles, 2001. "Physician Income Expectations and Specialty Choice," NBER Working Papers 8536, National Bureau of Economic Research, Inc.
    52. Jeff Dominitz & Charles F. Manski, 1996. "Eliciting Student Expectations of the Returns to Schooling," Journal of Human Resources, University of Wisconsin Press, vol. 31(1), pages 1-26.
    53. Robert Jensen, 2010. "The (Perceived) Returns to Education and the Demand for Schooling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(2), pages 515-548.
    54. Maarten L. Buis, 2008. "FMLOGIT: Stata module fitting a fractional multinomial logit model by quasi maximum likelihood," Statistical Software Components S456976, Boston College Department of Economics, revised 16 Feb 2017.
    55. Papke, Leslie E & Wooldridge, Jeffrey M, 1996. "Econometric Methods for Fractional Response Variables with an Application to 401(K) Plan Participation Rates," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 11(6), pages 619-632, Nov.-Dec..
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. is not listed on IDEAS
    2. Vaishali Zambre, 2018. "The Gender Gap in Wage Expectations: Do Young Women Trade off Higher Wages for Lower Wage Risk?," Discussion Papers of DIW Berlin 1742, DIW Berlin, German Institute for Economic Research.
    3. Arora, Nikita & Crastes dit Sourd, Romain & Hanson, Kara & Woldesenbet, Dorka & Seifu, Abiy & Quaife, Matthew, 2022. "Linking health worker motivation with their stated job preferences: A hybrid choice analysis in Ethiopia," Social Science & Medicine, Elsevier, vol. 307(C).
    4. Schweri, Juerg & Hartog, Joop, 2017. "Do wage expectations predict college enrollment? Evidence from healthcare," Journal of Economic Behavior & Organization, Elsevier, vol. 141(C), pages 135-150.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Schweri, Juerg & Hartog, Joop, 2017. "Do wage expectations predict college enrollment? Evidence from healthcare," Journal of Economic Behavior & Organization, Elsevier, vol. 141(C), pages 135-150.
    2. Pamela Giustinelli, 2022. "Expectations in Education: Framework, Elicitation, and Evidence," Working Papers 2022-026, Human Capital and Economic Opportunity Working Group.
    3. Vaishali Zambre, 2018. "The Gender Gap in Wage Expectations: Do Young Women Trade off Higher Wages for Lower Wage Risk?," Discussion Papers of DIW Berlin 1742, DIW Berlin, German Institute for Economic Research.
    4. Adeline Delavande & Basit Zafar, 2014. "University choice: the role of expected earnings, non-pecuniary outcomes, and financial constraints," Staff Reports 683, Federal Reserve Bank of New York.
    5. Fossen, Frank M. & Glocker, Daniela, 2017. "Stated and revealed heterogeneous risk preferences in educational choice," European Economic Review, Elsevier, vol. 97(C), pages 1-25.
    6. Pamela Giustinelli & Charles F. Manski, 2018. "Survey Measures Of Family Decision Processes For Econometric Analysis Of Schooling Decisions," Economic Inquiry, Western Economic Association International, vol. 56(1), pages 81-99, January.
    7. Stefan Klößner & Gregor Pfeifer, 2019. "The Importance of Tax Adjustments When Evaluating Wage Expectations," Scandinavian Journal of Economics, Wiley Blackwell, vol. 121(2), pages 578-605, April.
    8. 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.
    9. Barbara Eberth & Robert F. Elliott & Diane Skåtun, 2016. "Pay or conditions? The role of workplace characteristics in nurses’ labor supply," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 17(6), pages 771-785, July.
    10. Juerg Schweri, 2021. "Predicting polytomous career choices in healthcare using probabilistic expectations data," Health Economics, John Wiley & Sons, Ltd., vol. 30(3), pages 544-563, March.
    11. Kunz, Johannes S. & Staub, Kevin E., 2020. "Early subjective completion beliefs and the demand for post-secondary education," Journal of Economic Behavior & Organization, Elsevier, vol. 177(C), pages 34-55.
    12. Chris Belfield & Teodora Boneva & Christopher Rauh & Jonathan Shaw, 2016. "Money or fun? Why students want to pursue further education," IFS Working Papers W16/13, Institute for Fiscal Studies.
    13. Hans Ophem & Jacopo Mazza, 2024. "Educational choice, initial wage and wage growth," Empirical Economics, Springer, vol. 67(3), pages 1235-1274, September.
    14. Arpita Patnaik & Matthew J. Wiswall & Basit Zafar, 2020. "College Majors," NBER Working Papers 27645, National Bureau of Economic Research, Inc.
    15. Johannes S. Kunz & Kevin E. Staub, 2016. "Subjective completion beliefs and the demand for post-secondary education," Economics of Education Working Paper Series 0120, University of Zurich, Department of Business Administration (IBW).
    16. Matthew Wiswall & Basit Zafar, 2015. "Determinants of College Major Choice: Identification using an Information Experiment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 82(2), pages 791-824.
    17. Matthew Wiswall & Basit Zafar, 2011. "Belief updating among college students: evidence from experimental variation in information," Staff Reports 516, Federal Reserve Bank of New York.
    18. Lex Borghans & Bart H H Golsteyn & Anders Stenberg, 2015. "Does Expert Advice Improve Educational Choice?," PLOS ONE, Public Library of Science, vol. 10(12), pages 1-28, December.
    19. Arcidiacono, Peter & Hotz, V. Joseph & Maurel, Arnaud & Romano, Teresa, 2014. "Recovering Ex Ante Returns and Preferences for Occupations using Subjective Expectations Data," IZA Discussion Papers 8549, IZA Network @ LISER.
    20. Pfeifer, Gregor & Witte, Stefan, 2014. "Students' Wage Expectations in Germany - New Evidence considering Tax Adjusted Estimates," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100354, Verein für Socialpolitik / German Economic Association.

    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:vfsc14:100542. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/vfsocea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.