Heterogeneity in Human Capital Investments: High School Curriculum, College Major, and Careers

Posted: 1 Sep 2012

See all articles by Joseph G. Altonji

Joseph G. Altonji

Yale University - Economic Growth Center; National Bureau of Economic Research (NBER); Yale University - Cowles Foundation

Erica Blom

Yale University - Department of Economics

Costas Meghir

Yale University; Yale University - Cowles Foundation; Institute for Fiscal Studies (IFS); National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

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Date Written: July 2012

Abstract

Motivated by the large differences in labor market outcomes across college majors, we survey the literature on the demand for and return to high school and postsecondary education by field of study. We combine elements from several papers to provide a dynamic model of education and occupation choice that stresses the roles of the specificity of human capital and uncertainty about preferences, ability, education outcomes, and labor market returns. The model implies an important distinction between the ex ante and ex post returns to education decisions. We also discuss some of the econometric difficulties in estimating the causal effects of field of study on wages in the context of a sequential choice model with learning. Finally, we review the empirical literature on the choice of curriculum and the effects of high school courses and college major on labor market outcomes.

Suggested Citation

Altonji, Joseph G. and Blom, Erica and Meghir, Costas, Heterogeneity in Human Capital Investments: High School Curriculum, College Major, and Careers (July 2012). Annual Review of Economics, Vol. 4, pp. 185-223, 2012, Available at SSRN: https://ssrn.com/abstract=2139243 or http://dx.doi.org/10.1146/annurev-economics-080511-110908

Joseph G. Altonji (Contact Author)

Yale University - Economic Growth Center ( email )

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United States

National Bureau of Economic Research (NBER)

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Yale University - Cowles Foundation

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Erica Blom

Yale University - Department of Economics ( email )

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Costas Meghir

Yale University ( email )

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Yale University - Cowles Foundation ( email )

Box 208281
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United States

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National Bureau of Economic Research (NBER) ( email )

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Centre for Economic Policy Research (CEPR)

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IZA Institute of Labor Economics

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Germany

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