LABOR ECONOMICS
8th Edition
ISBN: 9781260004724
Author: BORJAS
Publisher: RENT MCG
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Question
Chapter 6, Problem 7RQ
To determine
The way in which the empirical studies estimate the
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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
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$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?
How does path dependency provide an explanation for differentiation in earnings between men & women?
two 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.
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