Working Paper: NBER ID: w17985
Authors: Joseph G. Altonji; Erica Blom; Costas Meghir
Abstract: Motivated by the large differences in labor market outcomes across college majors, we survey the literature on the demand for and return to high school and post-secondary education by field of study. We combine elements from several papers to provide a dynamic model of education and occupation choice that stresses the roles of specificity of human capital and uncertainty about preferences, ability, education outcomes, and labor market returns. The model implies an important distinction between the ex ante and ex post returns to education decisions. We also discuss some of the econometric difficulties in estimating the causal effects of field of study on wages in the context of a sequential choice model with learning. Finally, we review the empirical literature on choice of curriculum and the effects of high school courses and college major on labor market outcomes.
Keywords: No keywords provided
JEL Codes: I21; J24
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| high school curriculum (A21) | educational attainment (I21) |
| high school curriculum (A21) | wage rates (J31) |
| expected future earnings (G17) | choice of college major (A12) |
| preferences (D11) | choice of college major (A12) |
| preparation (Y20) | choice of college major (A12) |
| parental influence (J12) | educational decisions (I28) |
| financial transfers (H87) | educational opportunities (I24) |
| educational opportunities (I24) | career outcomes (J62) |
| college major (M39) | wage rates (J31) |