Should I stay or should I go? Educational choices and earnings: an empirical study for Portugal

Leonor Modesto*

*Corresponding author for this work

Research output: Contribution to journalReview articlepeer-review

3 Citations (Scopus)

Abstract

We analyse educational choices and earnings of individuals at two different levels in the Portuguese educational system. At each exit we consider two decisions: the decision to continue studying and the employment decision. We find empirical support for the existence of selectivity bias as the errors of the earnings functions are in general correlated with the disturbances of the decision functions. The obtained rates of return to education vary between 2.4 and 9.4 percent, depending on whether or not selectivity and quantity effects are excluded from the computations. Note that selectivity represents three quarters of this difference.
Original languageEnglish
Pages (from-to)307-322
Number of pages16
JournalJournal of Population Economics
Volume16
Issue number2
DOIs
Publication statusPublished - May 2003

Keywords

  • Earnings
  • Educational choices
  • Selectivity

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