Contemporary Labor Economics
Contemporary Labor Economics
11th Edition
ISBN: 9781259290602
Author: Campbell R. McConnell, Stanley L. Brue, David Macpherson
Publisher: McGraw-Hill Education
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Chapter 4, Problem 4QS

a)

To determine

Comment the statement ‘it may be rational for women to invest in less human capital than men’.

b)

To determine

Comment the statement ‘older workers are less mobile geographically than younger workers’.

c)

To determine

Comment the statement ‘collage enrollment will be stimulated by economic recession’.

d)

To determine

Comment on the given statement.

e)

To determine

Comment on the given statement that personal spending on education is always a good investment.

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The economic model of Human Capital Investment assumes that individuals choose their path through post-secondary education based solely on which path will provide them with the highest lifetime income. In reality, individuals often choose a path through post-secondary education that does not maximize their lifetime income, as a result of various factors. Consider Alex, an individual whose path through post-secondary education did not maximize their lifetime income. For each of the following potential reasons, construct a brief story that relates that reason to Alex's choice of post-secondary education. a) Utility/disutility from education b) Relationship between job satisfaction and education c) Uncertainty of different income streams d) Difficulty of financing human capital investments E.g. If the reason is "incomplete information", a potential answer would be: "Alex's high school guidance counsellor gave them a list of potential university programs that suited their strengths.…
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