Time-to-Degree and the Business Cycle

Dolores Messer () and Stefan Wolter
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Dolores Messer: University of Bern

No 2787, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: When students themselves enjoy large degrees of freedom in determining the duration of their studies, it results in a fairly large degree of interindividual variance in terms of time-to-degree. This paper investigates individual time-to-degree in a model where students determine the optimum time-to-degree whilst weighing up the cost against the consumption benefit accruing from an additional semester of studies. According to this model, the cost level and consumption benefit depend, in turn, on the general economic environment during the study period. An empirical investigation using a data set based on Swiss university graduates from 1981 to 2001 shows that changes in the unemployment rate, real interest rate, wage levels, and economic growth have a significant impact on individual time-to-degree. These results are consistent with the conclusions derived from the theoretical model.

Keywords: consumption benefit; time-to-degree; business cycle (search for similar items in EconPapers)
JEL-codes: C81 E32 I2 I23 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2007-05
New Economics Papers: this item is included in nep-mac and nep-sog
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Published - revised version published in: Education Economics, 2010, 18(1), 111-123

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Journal Article: Time-to-degree and the business cycle (2010)
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