The Social Returns to College Education——College Expansion and Human Capital Externalities
By analyzing the effects of the college expansion policy on different birth cohorts,this paper confirms the human capital externalities:the policy doesn't change the college attendance for the cohorts born before 1960,but it increases their annual income by about 1 500 yuan.The social returns to the poli-cy encompass the externalities and the private returns to cohorts born after 1960.The quantitative estima-tion shows that the social returns mainly come from human capital externalities.Neglecting these external-ities would underestimate policy benefits.Combined with the heterogeneity analysis,we further discuss the mechanisms about labor demand,industrial structure and industry development.
college expansionreturns to educationhuman capital externalities
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