Signaling and Employer Learning with Instruments

Gaurab Aryal (), Manudeep Bhuller and Fabian Lange

No 25885, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper considers the use of instruments to identify and estimate private and social returns to education within a model of employer learning. What an instrument identifies depends on whether it is hidden from, or transparent (i.e., observed) to, the employers. A hidden instrument identifies private returns to education, and a transparent instrument identifies social returns to education. We use variation in compulsory schooling laws across non-central and central municipalities in Norway to construct hidden and transparent instruments. We estimate a private return of 7.9%, of which 70% is due to increased productivity and the remaining 30% is due to signaling.

JEL-codes: J01 J24 J3 (search for similar items in EconPapers)
Date: 2019-05
New Economics Papers: this item is included in nep-lab
Note: ED LS
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Citations: View citations in EconPapers (8)

Published as Gaurab Aryal & Manudeep Bhuller & Fabian Lange, 2022. "Signaling and Employer Learning with Instruments," American Economic Review, vol 112(5), pages 1669-1702.

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Related works:
Journal Article: Signaling and Employer Learning with Instruments (2022)
Working Paper: Signaling and Employer Learning with Instruments (2021)
Working Paper: Signaling and Employer Learning with Instruments (2020)
Working Paper: Signaling and Employer Learning with Instruments (2020)
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