On the return–risk link in education

Abstract

In a contribution to Economics Letters, Pereira and Martins (2002) point out that there exists a positive link between risk and return in education. We perform a sensitivity analysis and argue that the evidence on this link is not robust.

Acknowledgements

I gratefully acknowledge financial support from the European Commission (EDWIN Project, HPSE-CT-2002-00108). For useful discussions, I am indebted to the participants in the CEEAplA Seminars held at the University of Madeira during March 2006. The usual disclaimer applies

Notes

¹ See <http://www.econ.au.dk/vip_htm/hnielsen/educationrisk/> (accessed: June 9th, 2006).

² See <http://www1.fee.uva.nl/scholar/> (accessed: June 9th, 2006).

³ One year for each country. Sample years go from 1991 for Sweden to 1996 for the Netherlands. The median year is 1995.

⁴ These data, reported by Martins and Pereira (2004) on p. 361, are very similar, although not identical, to those reported by Pereira and Martins (2002) on p. 33.

Table 1. Replication using data in Economics Letters

Table 2. Results using data in Labour Economics

⁵ As a matter of example, see Andini (2007b) for a brief review and a research advance.