Education and Lifetime Earnings in the United States

Christopher Tamborini, ChangHwan Kim () and Arthur Sakamoto

Demography, 2015, vol. 52, issue 4, 1383-1407

Abstract: Differences in lifetime earnings by educational attainment have been of great research and policy interest. Although a large literature examines earnings differences by educational attainment, research on lifetime earnings—which refers to total accumulated earnings from entry into the labor market until retirement—remains limited because of the paucity of adequate data. Using data that match respondents in the Survey of Income and Program Participation to their longitudinal tax earnings as recorded by the Social Security Administration, we estimate the 50-year work career effects of education on lifetime earnings for men and women. By overcoming the purely synthetic cohort approach, our results provide a more realistic appraisal of actual patterns of lifetime earnings. Detailed estimates are provided for gross lifetime earnings by education; net lifetime earnings after controlling for covariates associated with the probability of obtaining a bachelor’s degree; and the net present 50-year lifetime value of education at age 20. In addition, we provide estimates that include individuals with zero earnings and disability. We also assess the adequacy of the purely synthetic cohort approach, which uses age differences in earnings observed in cross-sectional surveys to approximate lifetime earnings. Overall, our results confirm the persistent positive effects of higher education on earnings over different stages of the work career and over a lifetime, but also reveal notably smaller net effects on lifetime earnings compared with previously reported estimates. We discuss the implications of these and other findings. Copyright Population Association of America 2015

Keywords: Lifetime earnings; Survey of Income and Program Participation; Economic returns to college; Semi-synthetic cohort estimation (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (46)

Downloads: (external link)
http://hdl.handle.net/10.1007/s13524-015-0407-0 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:demogr:v:52:y:2015:i:4:p:1383-1407

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/13524

DOI: 10.1007/s13524-015-0407-0

Access Statistics for this article

Demography is currently edited by John D. Iceland, Stephen A. Matthews and Jenny Van Hook

More articles in Demography from Springer, Population Association of America (PAA)
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().