Estimating Private Returns to Education in Mexico

Arnold Harberger () and Sylvia Guillermo-Peón

Latin American Journal of Economics-formerly Cuadernos de Economía, 2012, vol. 49, issue 1, 1-35

Abstract: This study explores the relationship between education and wages in Mexico. It contributes to our understanding of the structure of wages, helping explain individuals’ choices concerning education level. First, we estimate the age-earnings functions for each level of education. Then, taking into account some important costs of added years of study, we estimate the net present value of investment in human capital in each of four steps up the educational ladder. We estimate the internal rate of return associated with investment in each successive step considering different scenarios, two of which take into account prospective economic growth and mortality.

Keywords: Returns to education; age-earnings profiles; Mincer equation (search for similar items in EconPapers)
JEL-codes: I21 J31 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (2)

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