Capital humano y rendimientos de la educación en México

Abstract

This thesis analyzes the relationship between income and education in Mexico by calculating the rates of return to education. The data used was obtained from the Household Budget Survey of 1994 and 1996. Varios methods (direct, a mincerian income function, and elaborate or internal rate of return) and formal functions (using years of education, and controlling or not for working hours) are used. The results show the usefulness of controlling for working hours, and that the best fit is obtained when using the non-restricted elaborate method. Some of the most important and specific results are the higher rate of return of high school studies, and the higher rates of return to schooling for men with primary and university studies. Because Ordinary Least Squares estimations of the returns to education may be inconsistent due to the endogeneity of the "schooling" variable, another aim of the thesis consists in use Instrumental Variables methods in order to control by endogeneity bias. The main result is that the group with financial restrictions obtained a very much higher average return of the investment in education than the rest of the groups of the population. Finally, in this thesis a set of procedures is employed to test the signalling hypothesis versus the human capital hypothesis, as the more adequate explanation of wages in Mexico. The general conclusion is that, despite a weak impact of signalling should be considered, the human capital theory explains the lion part of the wage differentials in Mexico.