UNSPECIFIED (2003) The returns to education: Microeconomics. JOURNAL OF ECONOMIC SURVEYS, 17 (2). pp. 115-155.

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Abstract

In this paper we focus on education as a private decision to invest in 'human capital' and the estimation of the rate of return to that private investment. While the literature is replete with studies that estimate the rate of return using regression methods where the estimated return is obtained as the coefficient on a years of education variable in a log wage equation that contains controls for work experience and other individual characteristics, the issue is surrounded with difficulties. We outline the theoretical arguments underpinning the empirical developments and show that the evidence on private returns to the individual is compelling. Despite some of these issues surrounding the estimation of the return to schooling, our evidence, based on estimates from a variety of datasets and specifications, is that there is an unambiguously positive effect on the earnings of an individual from participation in education. Moreover, the size of the effect seems large relative to the returns on other investments.

Item Type:	Journal Article
Subjects:	H Social Sciences > HC Economic History and Conditions
Journal or Publication Title:	JOURNAL OF ECONOMIC SURVEYS
Publisher:	BLACKWELL PUBL LTD
ISSN:	0950-0804
Official Date:	April 2003
Dates:	Date Event April 2003 UNSPECIFIED
Volume:	17
Number:	2
Number of Pages:	41
Page Range:	pp. 115-155
Publication Status:	Published

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