Do Human Arts Really Offer a Lower Return to Education?

Carl-Johan Dalgaard, Esben Anton Schultz, Anders Sørensen

Publikation: Working paperForskning

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Is the wage gap between majors in human arts and other fields caused by their education per se? If the educational choice is endogenous, the gap may instead be caused by selection. We document that individuals’ educational choice is correlated with that of older students, and argue that it should not influence wages directly.
Exploiting this "cohort dependence" as an instrument for educational choice, our 2SLS estimates show that the hourly wage gap is attributable to selection. However, only half of the gap in annual earnings is explained by selection, whereas the other half is due to lower work hours.
UdgiverCentre for Economic and Business Research, Copenhagen Business School
Antal sider43
StatusUdgivet - 2012
NavnCEBR Discussion Paper


  • Returns to Education
  • Human Arts
  • Instrumental Variables