Estimating the variance of wages in the presence of selection and unobserved heterogeneity

• 成果类型: Article
• 署名作者: Chen, Stacey H.
• 署名单位: State University of New York (SUNY) System; University at Albany, SUNY
• 刊物名称: REVIEW OF ECONOMICS AND STATISTICS
• ISSN/ISSBN: 0034-6535
• DOI: 10.1162/rest.90.2.275
• 发表日期: 2008-05
• 页码: 275-289
• 关键词: EMPIRICAL-ANALYSIS; economic return; INEQUALITY; education; earnings; school; uncertainty; DYNAMICS; mobility; skills

摘要

Identification of potential wage distributions by education is important to the study of the causal links between education, inequality, and uncertainty. Potential wage inequality within an educational group (that is, the variance in wages if all workers had the same education) exceeds the observed statistics because self-selected education truncates wage distributions. Decomposing potential wage inequality into heterogeneity (known to the agent making the educational choice) and uncertainty (unknown to the agent) suggests that wage uncertainty does not necessarily rise with education. It is unobserved heterogeneity, not uncertainty, that explains the observed relationship between college graduation and higher wage inequality.