LABOR ECONOMICS
8th Edition
ISBN: 9781260004724
Author: BORJAS
Publisher: RENT MCG
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Chapter 6, Problem 7RQ
To determine
The way in which the empirical studies estimate the
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Students have asked these similar questions
Discuss how empirical studies estimate the rate of return to schooling and the methods used to avoid the problem of ability bias.
Derive the Stopping Rule for Investments in Education.
Suppose that, on average, men earn $17 an hour and have an average of 15
years of schooling. Women earn $15 an hour and have an average of 14
years of schooling. If the estimated return to schooling for men is 0.30
(implying that each additional year of schooling translates into an additional
30 cents per hour) and the returns for schooling for women is 0.2, then the
gender gap in schooling explains:
10% of the wage gap between men and women.
20% of the wage gap between men and women.
30% of the wage gap between men and women.
15% of the wage gap between men and women.
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- Suppose Fred's wage-schooling relationship is given by Years of Schooling Earnings 9 $28,000 10 $31,150 11 $33,700 12 $35,900 13 $37,400 14 $38,500 Derive the marginal rate of return schedule. When will Fred quit school if his discount rate is 5 percent? What if the discount rate is 10 percent?arrow_forwardtwo theories of education: human capital and signaling. Economists have estimated fairly large "sheepskin" effects, where wages increase significantly when someone earns a degree. Do you think these sheepskin effects are consistent with the human capital theory of education or signaling? Carefully explain. Do you think these theories could both hold some merit in the real world? Carefully explain.arrow_forwardThe use of group averages to judge individual productivity levels is called Statistical Discrimination. Therefore; this type of discrimination differs from ordinary discrimination because it is based on incomplete information rather than on the utility-maximizing choices of people with accurate information? True Falsearrow_forward
- Discuss Factor Intensity In detail.arrow_forwardImagine that the wage-schooling locus is given by w(s)=s^(1/3). What will be the optimal level of education for an individual to take if next period’s earnings in any given time are worth 95% of current earnings for that individual? Answer is s=20/57 I need step by step calculationsarrow_forwardStudies by Edwards and Meyer show that employers and teachers value different personality traits. In particular employers put a high value on creativity andindependence. True Falsearrow_forward
- More and more of the poor in the United States are women and children. Relate the feminization of poverty to the prevailing view of the poor held by most Americans. Is there an inconsistency? Why or why not?arrow_forwardIs poverty an unfortunate circumstance or a character defect?arrow_forwardAnn works for an organization that contracts with the state for services provided in an inpatient facility for adolescents with behavioral issues. Ann refers adolescents who do not live in her county to services in the county in which they reside. In addition to her regular case notes, Ann has to write a report that includes the activities she carried out with each client. This scenario addresses some of the reasons why social welfare policy is important to social work practice. Select the statement that best reflects this importance. Social policy specifies rules and regulations for social programs Social policy is written by social workers Social policy determines where each social worker will be employed All of the above None of the abovearrow_forward
- what does elimination of bias mean when doing a research studyarrow_forwardExplain the theory that education acts as a signaling device. How does this contrast with the theory of education as an investment with human capital?arrow_forwardDiscuss how the public provision of education can lead to less consumption of education than before the intervention.arrow_forward
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