Returns to Education: The Causal Effects of Education on Earnings, Health, and Smoking

James J. Heckman, John Humphries and Gregory Veramendi

Journal of Political Economy, 2018, vol. 126, issue S1, S197 - S246

Abstract: This paper estimates returns to education using a dynamic model of educational choice that synthesizes approaches in the structural dynamic discrete choice literature with approaches used in the reduced-form treatment effect literature. It is an empirically robust middle ground between the two approaches that estimates economically interpretable and policy-relevant dynamic treatment effects that account for heterogeneity in cognitive and noncognitive skills and the continuation values of educational choices. Graduating from college is not a wise choice for all. Ability bias is a major component of observed educational differentials. For some, there are substantial causal effects of education at all stages of schooling.

Date: 2018
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Related works:
Working Paper: Returns to Education: The Causal Effects of Education on Earnings, Health and Smoking (2016)
Working Paper: Returns to Education: The Causal Effects of Education on Earnings, Health and Smoking (2016)
Working Paper: Returns to Education: The Causal Effects of Education on Earnings, Health and Smoking (2016)
Working Paper: Returns to Education: The Causal Effects of Education on Earnings, Health and Smoking (2016)
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