Beyond signaling and human capital: Education and the revelation of ability
Abstract
We provide evidence that college graduation plays a direct role in revealing ability
to the labor market. Using the NLSY79, our results suggest that ability is observed
nearly perfectly for college graduates, but is revealed to the labor market more gradually
for high school graduates. Consequently, from the beginning of their careers, college
graduates are paid in accordance with their own ability, while the wages of high school
graduates are initially unrelated to their own ability. This view of ability revelation
in the labor market has considerable power in explaining racial differences in wages,
education, and returns to ability.
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https://hdl.handle.net/10161/4417Published Version (Please cite this version)
10.1257/app.2.4.76Publication Info
(2010). Beyond signaling and human capital: Education and the revelation of ability. American Economic Journal: Applied Economics, 2(4). pp. 76-104. 10.1257/app.2.4.76. Retrieved from https://hdl.handle.net/10161/4417.This is constructed from limited available data and may be imprecise. To cite this
article, please review & use the official citation provided by the journal.
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Show full item recordScholars@Duke
Peter S. Arcidiacono
Professor of Economics
Professor Arcidiacono specializes in research involving applied microeconomics, applied
economics, and labor economics. His research primarily focuses on education and discrimination.
His work focuses specifically on the exploration of a variety of subjects, such as
structural estimation, affirmative action, minimum wages, teen sex, discrimination,
higher education, and dynamic discrete choice models, among others. He recently received
funding from a National Science Foundation Grant for his pro
Patrick Bayer
Gilhuly Family Distinguished Professor in Economics
Bayer's research focuses on wide range of subjects including racial inequality and
segregation, social interactions, housing markets, education, and criminal justice.
His most recent work has been published in the Quarterly Journal of Economics, American
Economic Review, Econometrica, and the Review of Financial Studies. He is currently
working on projects that examine jury representation and its consequences, the intergenerational
consequences of residential and school segregation, neighborhood
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