Admission standards,student effort,and the creation of skilled jobs |
| |
Institution: | 1. Department of Economics, 327 Waters Hall, Kansas State University, Manhattan, KS 66506, United States;2. IHS Global Insight, Beijing, China;1. Faculty of Economics, Széchenyi István University, Egyetem tér 1, 9026 Győr, Hungary;2. K&H Bank, Lehner Ödön fasor 9, 1072 Budapest, Hungary;3. Department of Finance, Budapest University of Technology and Economics, Magyar tudósok krt. 2, 1117 Budapest, Hungary;1. Department of Economics, University of Calcutta, 56 A, B.T. Road, Kolkata 700050, India;2. Department of Economics, Spring Hill College, Mobile, USA |
| |
Abstract: | We consider the implications of expanding enrollment through lower standards in a model with human capital externalities and a market failure. Workers and firms make uncoordinated investment choices prior to random matching. Investment choices depend on the expected productivity of the counterpart in production. The setting generates a potential human capital externality as a more skilled labor force induces more skilled job openings. Exploiting the externality is complicated by a market failure which may cause some workers to earn a degree but not put forth the effort required to become highly skilled. We show that beyond a threshold, increased enrollment through low standards can be poor policy. Policies which increase returns to agents and firms in best matches can improve outcomes. |
| |
Keywords: | |
本文献已被 ScienceDirect 等数据库收录! |
|