Title: Labor Market Experience and Returns to Education in Fast Growing Economies

Speaker: Associate Professor Binzhen Wu, Tsinghua university 

Time: May 26th, 2017 15:00–16:15

Venue: Conference Room 106B, Zhonghui Building (College of Economics, JNU)

Abstract:

China's college admissions increased by seven times in a decade. While the college premium for young workers declined, that for senior workers increased in the same period. In our general equilibrium model, a rising demand for skills (education and experience) explains both trends. Because the supply of education is elastic, a demand shock leads to college expansion, depressing the college premium for young workers. With an inelastic supply, experienced workers continue to enjoy a rising premium. Despite the low immediate college premium, young individuals continue to flood into colleges because they foresee high lifetime returns. Simulations match empirical results well.