Ability Bias, Skewness and the College Wage Premium

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.


Issue Date:
2009-05
Publication Type:
Working or Discussion Paper
DOI and Other Identifiers:
Record Identifier:
https://ageconsearch.umn.edu/record/271293
Language:
English
Total Pages:
13
JEL Codes:
J31; J24; I21; D82
Series Statement:
WERP 907




 Record created 2018-04-12, last modified 2020-10-28

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