The Wage Return to Education: What Hides Behind the Least Squares Bias?

This paper combines the approach by Guimarães and Portugal (2010) with the methodology of Gelbach (2015) to investigate the determinants of the least squares bias of the wage return to education. We find that disregarding individual fixed effects is highly problematic, accounting for 95% of the bias. In contrast, disregarding firm fixed effects has marginal consequences.

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Year of publication:	2015-02
Authors:	Andini, Corrado
Institutions:	Institute for the Study of Labor (IZA)
Subject:	wages \| education \| least squares

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Extent:	application/pdf
Series:	IZA Discussion Papers.
Type of publication:	Book / Working Paper
Notes:	Number 8855 9 pages
Classification:	I21 - Analysis of Education ; J31 - Wage Level and Structure; Wage Differentials by Skill, Training, Occupation, etc
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011183120