TY  - RPRT
        AU  - Bhuller, Manudeep
AU  - Mogstad, Magne
AU  - Salvanes, Kjell G.
        TI  - Life-Cycle Bias and the Returns to Schooling in Current and Lifetime Earnings
        PY  - 2011/Jun/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 5788
        UR  - https://www.iza.org/index.php/publications/dp5788
        AB  - This paper uses a unique data set with nearly career-long earnings histories to provide evidence on the returns to schooling in current and lifetime earnings. We use these results to assess the importance of life-cycle bias in earnings regressions using current earnings as a proxy for lifetime earnings. To account for the endogeneity of schooling, we apply three commonly used identification strategies. Our estimates demonstrate a strong life-cycle bias, often exceeding the bias from assuming that schooling is exogenous. We further explore the problems caused by life-cycle bias in research on the economic returns to schooling, and discuss possible remedies.
        KW  - returns to schooling
KW  - life-cycle bias
KW  - lifetime earnings
KW  - current earnings
KW  - errors-in-variables model
        ER  -