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- Title
Interpreting Degree Effects in the Returns to Education.
- Authors
Flores-Lagunes, Alfonso; Light, Audrey
- Abstract
Researchers often identify degree effects by including degree attainment (D) and years of schooling (S) in a wage model, yet the source of independent variation in these measures is not well understood. We argue that S is negatively correlated with ability among degree-holders because the most able graduate the fastest, but positively correlated among dropouts because the most able benefit from increased schooling. Using NLSY79 data, we find support for this argument; our findings also suggest that highest grade completed is the preferred measure of S for dropouts, while age at school exit is a more informative measure for degree-holders.
- Subjects
LABOR economics; EFFECT of education on wages; HUMAN capital; EMPLOYMENT of school dropouts; EDUCATION &; economics; WAGE increases; ECONOMICS
- Publication
Journal of Human Resources, 2010, Vol 45, Issue 2, p439
- ISSN
0022-166X
- Publication type
Article
- DOI
10.3368/jhr.45.2.439