Do the Cognitive Skills of School Dropouts Matter in the Labor Market?

23 Pages Posted: 25 Aug 1999 Last revised: 5 May 2000

See all articles by John H. Tyler

John H. Tyler

Brown University - Taubman Center for Public Policy; National Bureau of Economic Research (NBER)

Richard J. Murnane

Harvard University - Harvard Graduate School of Education; National Bureau of Economic Research (NBER)

John B. Willett

Harvard University - Harvard Graduate School of Education

Date Written: April 1999

Abstract

Does the U.S. labor market reward cognitive skill differences among high school dropouts, the members of the labor force with the least educational attainments? This paper reports the results of an exploration of this question, using a new data set that provides information on the universe of dropouts who last attempted the GED exams in Florida and New York between 1984 and 1990. The design of the sample reduces variation in unmeasured variables such as motivation that are correlated with cognitive skills. We examine the labor market returns to basic cognitive skills as measured by GED test scores. We explore whether the returns differ by gender and race. The results indicate quite large earnings returns to cognitive skills for both male and female dropouts, and for white and non-white dropouts. The earnings payoff to skills increases with age.

Suggested Citation

Tyler, John H. and Murnane, Richard J. and Willett, John B., Do the Cognitive Skills of School Dropouts Matter in the Labor Market? (April 1999). NBER Working Paper No. w7101. Available at SSRN: https://ssrn.com/abstract=164950

John H. Tyler (Contact Author)

Brown University - Taubman Center for Public Policy ( email )

Providence, RI 02912
United States
401-863-1036 (Phone)
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National Bureau of Economic Research (NBER)

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Richard J. Murnane

Harvard University - Harvard Graduate School of Education ( email )

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Cambridge, MA 02138
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National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States
617-496-4820 (Phone)
617-496-3095 (Fax)

John B. Willett

Harvard University - Harvard Graduate School of Education ( email )

6 Appian Way
Cambridge, MA 02138
United States
617-495-3401 (Phone)

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