Estimating the social return to higher education: Evidence from logitudinal and repeated cross-sectional data

January 2004

Moretti estimates spillovers from college education by comparing wages for otherwise similar individuals who work in cities with different shares of college graduates in the labor force. He finds that a percentage point increase in the supply of college graduates raises high school drop-outs' wages by 1.9 percent, high school graduates' wages by 1.6 percent, and college graduates' wages by 0.4 percent.