Resource title

Educational expansion and its heterogeneous returns for wage workers

Resource image

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Resource description

The paper examines the evolution of returns to education in the West German labour market over the last two decades. During this period, graduates from the period of educational expansion in the sixties and seventies entered the labour market and an upgrading of the skill structure took place. In order to tackle the issues of endogeneity of schooling and its heterogeneous returns we apply two estimation methods: Wooldridge?s (2004) approach that relies on conditional mean independence and Garen?s (1984) control function approach that requires an exclusion restriction. For the population of workers from the GSOEP, we find that both approaches produce estimates of average returns to education that decrease until the late 1990s and increase significantly afterwards. In the observation period, the gender gap in returns to education seems to vanish. Furthermore, we find that the so called ?baby boomer? cohort has the lowest average return to education in young ages. However, this effect disappears when they become older.

Resource author

Michael Gebel, Friedhelm Pfeiffer

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/24560

Resource license

Adapt according to the presented license agreement and reference the original author.