Earnings Expectations and Educational Sorting: An Ex‐Ante Perspective on Returns to University Education
Year: 2025
Type: article
Study design: Observational Study
Abstract: ABSTRACT We estimate ex‐ante treatment effects in earnings for attending university using survey data of the expectations of Stockholm high school students under different educational counterfactuals. Although the levels of earnings expectations are reasonable, they differ between stated and revealed educational preferences. The average ex‐ante return is estimated to be 45%, with higher returns for female, high SES, and high math score students. The return is positive even for those who choose high school, unless they discount their future earnings streams by at least 4%–6%. We also find that students sort into education based on their perceived comparative advantage.
Source: Journal of Applied Econometrics
DOI: 10.1002/jae.70015
Institutions: Uppsala University, Tsinghua University, University of Gothenburg
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
SDG: Quality education
Open Access status: hybrid
Estimated APC paid: $4,030
Funders: Torsten Söderbergs Stiftelse, Aarhus Universitet, Universitetet i Bergen, Göteborgs Universitet, Forskningsrådet om Hälsa, Arbetsliv och Välfärd, Uppsala Universitet, Universität Duisburg-Essen, Institutet för arbetsmarknads- och utbildningspolitisk politisk utvärdering, Core Research for Evolutional Science and Technology
OpenAlex ID: W4415166184