Sheepskin Effects in Japan

17 Pages Posted: 4 Dec 2002

See all articles by Thomas K. Bauer

Thomas K. Bauer

Rhine-Westphalia Institute for Economic Research (RWI-Essen); University of Bochum - Faculty of Economics; IZA Institute of Labor Economics

Patrick J. Dross

DIW Berlin; Humboldt University, Berlin

John P. Haisken-DeNew

University of Melbourne - Melbourne Institute: Applied Economic & Social Research; McMaster University, Faculty of Social Sciences, Department of Economics

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Date Written: November 2002

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: Returns to education, sheepskin effects, Japan

JEL Classification: I21, J24, J31

Suggested Citation

Bauer, Thomas K. and Dross, Patrick J. and Haisken-DeNew, John P., Sheepskin Effects in Japan (November 2002). Available at SSRN: https://ssrn.com/abstract=354782

Thomas K. Bauer (Contact Author)

Rhine-Westphalia Institute for Economic Research (RWI-Essen) ( email )

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Patrick J. Dross

DIW Berlin ( email )

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Humboldt University, Berlin

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John P. Haisken-DeNew

University of Melbourne - Melbourne Institute: Applied Economic & Social Research

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Australia

McMaster University, Faculty of Social Sciences, Department of Economics ( email )

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