Do They Understand the Benefits from Education? Evidence on Dutch High School Students' Earnings Expectations

61 Pages Posted: 23 May 2011

See all articles by Jacopo Mazza

Jacopo Mazza

University of Amsterdam

Joop Hartog

University of Amsterdam - Faculty of Economics and Business (FEB); Tinbergen Institute; CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Abstract

Using an internet collected dataset, we will provide some empirical evidence on the information that Dutch high school students possess before their decision on tertiary education participation. The sample is prone to selective participation and high attrition, but we detect little systematic effects and inconsistent reporting of probability distribution is not more frequent than in controlled settings. We find little support for patterns that one would expect from individuals having private information. Girls expect substantially lower earnings in all schooling scenarios, but implicit rate of returns do not differ from those anticipated by boys. We find no evidence of expected risk compensation.

Keywords: wage expectations, wage risk, risk compensation

JEL Classification: J24, J31, I20

Suggested Citation

Mazza, Jacopo and Hartog, Joop, Do They Understand the Benefits from Education? Evidence on Dutch High School Students' Earnings Expectations. IZA Discussion Paper No. 5714. Available at SSRN: https://ssrn.com/abstract=1849469

Jacopo Mazza (Contact Author)

University of Amsterdam ( email )

Spui 21
Amsterdam, 1018 WB
Netherlands

Joop Hartog

University of Amsterdam - Faculty of Economics and Business (FEB) ( email )

Roetersstraat 11
Amsterdam, 1018 WB
Netherlands

Tinbergen Institute

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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