Essays on labor markets and higher education
Abstract
This research studies three topics concerning higher education and labor market returns. Essay I develops a signaling model which predicts that the earnings of college graduates are positively related to three factors: an individual student's overall grade point average, the quality of institution from which a student graduates, and the variation in student abilities at that institution. These predictions are supported by empirical tests. Essay II develops a model of the tenure decision for university faculty, taking the perspective of a tenure committee member. The model identifies the costs of Type I and Type II error in making the tenure decision which are related to sources of university revenue. Subsequent data analysis indicates that the probability a given faculty member receives tenure depends on the proportion of funding received from different sources, as predicted by the model. The role of other institutional characteristics in determining the probability of tenure is also discussed, Finally, Essay III emphasizes the potential substitutability between salaries and tenure in rewarding faculty. Analysis there reveals that schools which grant tenure more readily also pay lower salaries, on average. This result holds for salaries across all ranks of professor.
Degree
Ph.D.
Advisors
Barron, Purdue University.
Subject Area
Labor economics|Higher education|School finance
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