Selective Migration, Occupational Choice, and the Wage Returns to College Majors

Tyler Ransom

Annals of Economics and Statistics, 2021, issue 142, 45-110

Abstract: I examine the extent to which the monetary returns to college majors are influenced by selective migration and occupational choice across locations in the US. To quantify the role of selection, I develop and estimate an extended Roy model of migration, occupational choice, and earnings where, upon completing their education, individuals choose a location in which to live and an occupation in which to work. In order to estimate this high-dimensional choice model, I make use of machine learning methods that allow for model selection and estimation simultaneously in a non-parametric setting. I find that OLS estimates of the return to business and STEM majors relative to education majors are biased upward by 15% at the median. Selection is strongest in locations in the Northeastern US.

Keywords: Vocational Education; Returns to Skills; Unobserved Heterogeneity (search for similar items in EconPapers)
JEL-codes: I2 J3 R1 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (2)

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Working Paper: Selective Migration, Occupational Choice, and the Wage Returns to College Majors (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:adr:anecst:y:2021:i:142:p:45-110

DOI: 10.15609/annaeconstat2009.142.0045

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