What conditions can rate of return to schooling be estimated

Reference no: EM131923423

Problem

1. Discuss how differences in discount rates or in ability across workers lead to differences in earnings and schooling. Under what conditions can the rate of return to schooling be estimated?

2. Discuss the relationship between ability bias in the estimation of the rate of return to schooling and selection bias in tests of the hypothesis that workers choose the level of schooling that maximizes the present value of earnings.

Reference no: EM131923423

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