Returns to Education and Wage Equations

37 Pages Posted: 11 Jun 2001

See all articles by Pedro Telhado Pereira

Pedro Telhado Pereira

Universidade da Madeira - Gestao e Economica; IZA Institute of Labor Economics

Pedro S. Martins

Queen Mary College - School of Business and Management; IZA Institute of Labor Economics; New University of Lisbon

Date Written: June 2001

Abstract

We show why considering a number of education-dependent covariates in the wage equation decreases coefficient of education in the wage equation. We use a meta-analysis of results for Portugal to show, empirically, that this is the case. The coefficient decreases when we use covariates that can be considered post education decisions; it is independent of the sample size, tenure and the fact of using hourly or monthly wages. At this stage the use of the simple specification of the Mincer equation for the study of total returns to education continues to hold our support.

Keywords: Human Capital, Rate of Return, Educational Economics

JEL Classification: C4, I2, J3

Suggested Citation

Telhado Pereira, Pedro and Martins, Pedro S., Returns to Education and Wage Equations (June 2001). IZA Discussion Paper No. 298. Available at SSRN: https://ssrn.com/abstract=270791

Pedro Telhado Pereira (Contact Author)

Universidade da Madeira - Gestao e Economica ( email )

Campus Universitario da Penteada
9000-390 Funchal
Portugal
351 291 70 50 40 (Phone)
351 291 70 50 43 (Fax)

HOME PAGE: http://www.uma.pt/Privado/ppereira

IZA Institute of Labor Economics

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

Pedro S. Martins

Queen Mary College - School of Business and Management ( email )

Mile End Road
London, E1 4NS
United Kingdom

HOME PAGE: http://webspace.qmul.ac.uk/pmartins

IZA Institute of Labor Economics

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

New University of Lisbon

Lisbon, 1099-085
Portugal

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