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Using Geographic Variation in College Proximity to Estimate the Return to Schooling (1993)
| Venue: | Progress on Some Persistent Econometric Problems.” Econometrica 69 (September |
| Citations: | 413 - 2 self |
BibTeX
@INPROCEEDINGS{Card93usinggeographic,
author = {David Card and David Card},
title = {Using Geographic Variation in College Proximity to Estimate the Return to Schooling},
booktitle = {Progress on Some Persistent Econometric Problems.” Econometrica 69 (September},
year = {1993},
pages = {1127--1160}
}
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Abstract
Although schooling and earnings are highly correlated, social scientists have argued for decades over the causal effect of education. A convincing analysis of the causal link between education and earnings requires an exogenous source of variation in education outcomes. This paper explores the use of college proximity as an exogenous determinant of schooling. An examination of the NLS Young Men Cohort reveals that men who grew up in local labor markets with a nearby college have significantly higher education and significantly higher earnings than other men. The education and earnings gains are concentrated among men with poorlyeducated parents -- men who would otherwise stop schooling at relatively low levels. When college proximity is taken as an exogenous determinant of schooling the implied instrumental variables estimates of the return to schooling are 25-60% higher than conventional ordinary least squares estimates.
Keyphrases
college proximity geographic variation exogenous determinant local labor market poorlyeducated parent men implied instrumental variable estimate exogenous source convincing analysis causal effect education outcome low level causal link earnings gain nls young men cohort square estimate social scientist nearby college
