Working Paper: CEPR ID: DP3609
Authors: Thomas Bauer; Patrick J. Dross; John P. Haisken-DeNew
Abstract: Using data for the 1990s, this Paper examines the role of sheepskin effects in the returns to education for Japan. Our estimations indicate that sheepskin effects explain about 50% of the total returns to schooling. We further find that sheepskin effects are only important for workers in small firms with the size of these effects being similar to comparable estimates for the US. These results could be explained by the particular recruitment system of large firms in Japan, which makes the university diploma unimportant as a screening device for large firms.
Keywords: Japan; Returns to Education; Sheepskin Effects
JEL Codes: I21; J24; J31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| educational attainment (I21) | labor earnings (J31) |
| sheepskin effects (C92) | labor earnings (J31) |
| firm size (L25) | sheepskin effects (C92) |
| sheepskin effects in large firms (L25) | labor earnings (J31) |