Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/20895
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dc.contributor.authorBelzil, Christianen_US
dc.contributor.authorHansen, Jörgenen_US
dc.date.accessioned2009-01-28T16:17:39Z-
dc.date.available2009-01-28T16:17:39Z-
dc.date.issued1999en_US
dc.identifier.urihttp://hdl.handle.net/10419/20895-
dc.description.abstractUsing a dynamic programming model of schooling decisions, we investigate the relationshipbetween subjective discount rates and the labor market ability (the discount rate bias) on apanel taken from the National Longitudinal Survey of Youth (NLSY). Given householdhuman capital and Armed Forces Qualification test scores (AFQT), subjective discount rates,which vary between 1% and 5% per year, are found to be negatively correlated with labormarket ability. The true return to schooling is estimated around 6% per year. Estimatesobtained from a model where neither the ability bias nor the discount rate bias areconsidered, indicate that one percentage point can be imputed to the correlation betweendiscount rates and labor market ability and at least another percentage point can be imputedto the positive correlation between the per-period utility of attending school and labor marketability. The model is used to simulate the effects of an increase in the level of human capitalof one generation on both schooling attainments and labor market productivity of the nextgeneration. We find the true intergenerational education correlation to be relatively low; anincrease of 1 year in the average level of schooling will raise the level of human capital ofthe next generation by approximately 0.15 year of schooling and translates into a 1%productivity (wage) growth.en_US
dc.language.isoengen_US
dc.publisher|aInstitute for the Study of Labor (IZA) |cBonnen_US
dc.relation.ispartofseries|aIZA Discussion paper series |x60en_US
dc.subject.jelJ3en_US
dc.subject.jelJ2en_US
dc.subject.ddc330en_US
dc.subject.keywordIntergenerational transfersen_US
dc.subject.keywordreturns to educationen_US
dc.subject.keywordsubjective discount ratesen_US
dc.subject.keywordhuman capitalen_US
dc.subject.keywordschooling decisionsen_US
dc.subject.stwBildungsökonomiken_US
dc.subject.stwBildungsinvestitionen_US
dc.subject.stwBildungsertragen_US
dc.subject.stwAbzinsungen_US
dc.subject.stwPrivater Transferen_US
dc.subject.stwSchätzungen_US
dc.subject.stwUSAen_US
dc.titleSubjective Discount Rates, Intergenerational Transfers and the Return to Schoolingen_US
dc.typeWorking Paperen_US
dc.identifier.ppn83406698Xen_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-

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