Heterogeneous economic returns to post-secondary degrees: Evidence from Chile

Jorge Rodríguez, Sergio Urzúa, Loreto Reyes

Research output: Contribution to journalArticlepeer-review

9 Scopus citations

Abstract

We analyze the economic returns to post-secondary degrees in Chile. We posit a schooling decision model with unobserved ability, degree-specific tuition costs, and earnings. We use administrative records to carry out our empirical analysis. Our results show positive average returns to post-secondary education, especially for five-year degrees. However, we also uncover significant heterogeneity. We document how unobserved characteristics (ability) determine the economic benefits of first- and second-best choices, even leading to negative returns to post-secondary degrees. Our findings illustrate the importance of allowing for heterogeneous treatment effects and individuals' choices when examining the returns to education.

Original languageEnglish
Pages (from-to)416-460
Number of pages45
JournalJournal of Human Resources
Volume51
Issue number2
DOIs
StatePublished - 2016
Externally publishedYes

Bibliographical note

Publisher Copyright:
© 2016 by the Board of Regents of the University of Wisconsin System.

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