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Ability bias, skewness and the college wage premium

By Robin Naylor and Jeremy Smith

Abstract

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

Topics: HD
Publisher: University of Warwick, Department of Economics
Year: 2009
OAI identifier: oai:wrap.warwick.ac.uk:1310

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Citations

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