Estimating the Payoff to Schooling Using the Vietnam-Era Draft Lottery / Joshua D. Angrist, Alan B. Krueger.

Format:

Book

Author/Creator:

Angrist, Joshua D.

Contributor:

National Bureau of Economic Research.

Krueger, Alan B.

Series:

Working Paper Series (National Bureau of Economic Research) no. w4067.

NBER working paper series no. w4067

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1992.

Summary:

Between 1970 and 1973 priority for military service was randomly assigned to draft-age men in a series of lotteries. Many men who were at risk of being drafted managed to avoid military service by enrolling in school and obtaining an educational deferment This paper uses the draft lottery as a natural experiment to estimate the return to education and the veteran premium. Estimates are based on special extracts of the Current Population Survey for 1979and 1981-85. The results suggest that an extra year of schooling acquired in response to the lottery is associated with6.6 percent higher weekly earnings. This figure is about 10 percent higher than the OLS estimate of the return to education in this sample, which suggests there is omitted-variable bias in conventional estimates of the return to education. Our findings are robust to a variety of assumptions about the effect of veteran status on earnings.

Notes:

Print version record

May 1992.