This study, in concert with previous studies, attempts to separate out the independent effects of the signaling and human capital mechanisms, arguing that individuals utilize higher education to signal a broad set of inherent productivity enhancing characteristics, which are unobserved by employers. I argue that several past studies, namely Chevalier (2004), have focused too narrowly on measures of inherent intelligence as representative of an individual’s signaled productivity-enhancing characteristics and that estimates of the signaling effect might have been downwardly biased as a result.
Recommended CitationKjelland '08, Jim (2008) "Economic Returns to Higher Education: Signaling v. Human Capital Theory; An Analysis of Competing Theories," The Park Place Economist: Vol. 16
Available at: http://digitalcommons.iwu.edu/parkplace/vol16/iss1/14