Ability Bias, Skewness and the College Wage Premium
Robin Naylor () and
The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics
Changes in educational participation rates across cohorts are likely to imply changes in the ability-education relationship and thereby to impact on estimated returns to education. We show that skewness in the underlying ability distribution is a key determinant of the impact of graduate expansion on the college wage premium. Calibrating the model against the increased proportion of university students in Britain, we find that changes in the average ability gap between university students and others are likely to have mitigated demand-side forces.
Keywords: Ability Bias; College Wage Premium; Graduate Returns; Cohort Effects (search for similar items in EconPapers)
JEL-codes: J31 J24 I21 D82 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-edu, nep-hrm and nep-lab
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Persistent link: https://EconPapers.repec.org/RePEc:wrk:warwec:907
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