...Paper Some individuals believe that education and earnings go hand in hand. The lesser the education, the smaller the wages, and thus with a greater education may lead to an increase in wages. The focus of this discussion will involve what the research process entails for the subject of wages and the relationship between education, and wage earnings. This research project will discuss the purpose of the research, define the problem, propose three possible hypothesizes, identify the variables, and define the problem in quantifiable measurements. According to some research studies the level of education that an individual obtains directly correlates to the wages that he or she will earn over his or her lifetime. The higher the degree of education that a person attains can affect the amount of wages that he or she will earn. Research shows that there is also a difference in wage earnings by males and females who have earned the same degrees. “The highest paid 10% of male workers with advanced degrees earned $3,260 or more weekly, compared to $2,252 or more for women of the same education level” (Wall Street Journal, 2009). The research suggests that there is an advantage of an increase in earning power by an individual who continues his or her education, and advances the degrees that he or she holds. This research may be important for anyone who is considering whether or not he or she should continue to further his or her education. The time, effort, and expense that a person...
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...2. “Expenditures on education and training can be treated as investment in human capital.” This statement is: a. true—current expenses are incurred with the expectation they will be more than compensated for by greater future returns b. true—education must be financed by borrowing money c. false—the market for college loans is too imperfect to be consistent with investment models d. false—education is purchased for its current (consumption) value, not its future (investment) value 3. Approximately what percentage of the U.S. population had completed four or more years of college by the year 2006? a. 8% b. 14% c. 29% d. 41% 4. Age-earnings data show that: a. differences in earnings by education level disappear for workers age 55 and over b. men’s earnings increase with educational level but not women’s earnings c. earnings rise with factors such as family background and personal drive, but not education level d. higher educational levels are consistently associated with higher earnings 5. Available evidence indicates that: a. age-earnings profiles vary with education, but not with age b. age-earnings profiles vary with age, but not with education c. age-earnings profiles of workers with more education tend to be flatter, but higher, than those with less education d. differences in earnings between workers who have more education and those who have less education generally widen with age 6. The total economic cost of formal education typically does not include: ...
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...The objective of this literature review is to explore what have already been written and get a better understanding on private return to schooling. Moreover through the literature it becomes clearer on how to reply to our research questions and how to meet the objectives on this dissertation. Theoretical review Return to education is today’s investment in term of monetary and non-monetary cost (Spraul, 2006) in order to get immediate need satisfaction or future monetary and non-monetary benefits (Dohmen, 2004).The return to education can also be formulated as how investment in education can yield future benefit (Dohmen, 2004) Return to education can be defined as the difference between the price of educated and non-educated labor. Individual...
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...least squares (OLS) to estimate the earnings function, the problem with using OLS is that education is endogenous. Relatively few studies of the returns to schooling in China have used instrumental variables to address the endogeneity of education (see Chen & Hamori, 2009; Fleisher et al., 2005; Heckman & Li, 2004; Li & Luo, 2004; Zhang, Liu, & Yung, 2007) Necessary but not sufficient Completing additional years of education has a range of positive outcomes. Income may be higher, employment easier to obtain and health better (Card 2001; Wolfe and Havemann 2001; Borland 2002). There are a number of individual factors that influence the return to a given level of education, including cognitive ability (Tobias 2003; Heckman, Stixrud, and Urzua 2006), discrimination in the labour market (Hunter 2004) and unobserved costs to education. Individuals would move to areas where the remuneration for their level of education was highest and students would move to areas with the lowest cost of education. However, there are social and economic costs to migration (Greenwood 1997; Yankow 2003), and hence, local resource endowments are likely to have some effect on the returns to education through the relative demand for skilled and non-skilled workers in the area. Social return to college educ : south korea Since the pioneering work of Schultz (1961) in human capital, much economic literature studies the importance of education on socioeconomic variables such ...
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...factors accounting for the decline in men’s participation rate in labor force, including changes in laws and government regulations. Social security retirements for the elderly population have affected labor force participation rates. Besides, Social Security Act, which was amended in 1960, has allowed individuals under age 50 eligible to receive disability payments. By providing people with non-labor income, it reduces the incentive to work which leads to people dropping out of the labor force. In contrary, remarkable changes in labor force participation rates of women reflected their significant role in the world of work over the past 60 years. Access to higher education and training used to be a significant barrier to women’s participation in the workforce. However, since the 1950s, the ability to pursue higher education, occupational structure of the economy and medical advances have allowed women to choose between household labor and work in the labor market in order to maximize their utility. Labor-saving technology and home-care products such as washers and dryers, dishwashers, etc. have helped to reduce the amount of time spending on household tasks. Birth control has also provided women with more choices in child bearing decision. Hence, they have had more opportunities to participate in the workforce. Recession is a significant decline in activity across the economy which lasts for two consecutive quarters. One of its characteristics is a rise in...
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...April 2012 Education and Earnings Among Men and Women Everyone out there in this world would always like to make more money or think they are getting underpaid. From the grunts in the labor line to the stars of the NBA, people are always going to feel they deserve more than what they are getting paid. Growing up and making ways through grade school into high school everyone has told students that education is the key to making more and more money throughout their careers. Not only do women have lower real earnings than men but people with lower education also have lower real earnings than others with the higher education. There is a strong positive relationship between he amount of education one invests into and one who does not and their salary earnings on a year-to-year basis. Men have always made more than women throughout American history. This could partly be based on the fact that women used to be more of the home keeper and raises children for families where father’s worked. Even with men making more than women, the amount of education a person has whether, male or female, raises the amount of income for that particular person. For example, “High school graduates earned almost 50 percent more than their counterparts with less than a high school education. Male college graduates working full-time, year-round earned $75,130, compared with $40,112 for men with only a high school education.” (Gwartney, Stroup, Sobel, & Macpherson 286). The amount of education can greatly...
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...hourly wage data, which is a more precise measure as the earnings data series takes into account the price of labour as well as quantity (i.e. individuals’ work/leisure preferences). This study looks at the variables of race, highest achieved level of education as well as age to examine the existence of a wage gap. Like other studies, we have found that males have a higher wage in each of these areas, with females earning an average of 80 – 87% of the males’ average. Furthermore, we have examined the existence and size of a wage gap in three industries; law, nursing and the education industry. Finally, we looked at the Canadian gender-based wage gap statistics compared to International gender-based wage gap statistics. We deduced that there is, indeed, a wage gap in each of the mentioned industries, and can be partially attributed to human capital theory and occupational segmentation theory, however, a substantial portion of the gap remains unexplained. 2. General Existence of Gender-Based Wage Differentials in Canada The existence of gender based wage differentials in North America have been well documented for decades. Although female-male wage ratios have closed significantly since the mid 1980s, progress in wage equalization has seen some stabilization in recent years. Many past studies on wage differentials in Canada, including Statistic’s Canada’s “Income Trends in Canada” report, use male and female annual earnings data as opposed to hourly wage data. Baker and Drolet...
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...PURPOSE OF HIGHER EDUCATION What Is the Purpose of Higher Education Excellent Student English101 May 31, 2014 Melissa Davis 1 WHAT IS THE PURPOSE OF HIGHER EDUCATION 2 What Is the Purpose of Higher Education A higher education can be a difficult decision in your life, and while many high school students as well as adults struggle with this due to the cost. The purpose of a higher education outweighs the cost, offers greater earning potential and career. In the last 22 years, I have noticed a drastic change in the job market. In fact, more and more employers are requesting potential employees to have some form of education above high school. Truly, high school students and adults struggle with the decision to gain a higher education due to the cost. Indeed, while earning your degree can carry a hefty price tag, you shouldn’t let that distract you from seeing the bigger picture. There are a wide variety of financial aid options available that can help with the cost. For example, the federal government offers money, and your work may offer a tuition reimbursement program. Moreover, in a 66 page report, from Pew Research Center, it stated that, “An overwhelming percentage of college graduates then and now believe their college degree did or will pay off, despite the financial investment,” (Weinreich, 2014). Besides struggling with the cost, you must also consider the greater earning potential for someone that holds an education above high school...
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...interest on school debt. From 2000–01 to 2010–11, current expenditures per student enrolled in the fall in public elementary and secondary schools increased by 14 percent (from $9,751 to $11,153 in constant 2012–13 dollars). The amount for 2010–11, however, was lower than the amount for 2009–10 ($11,353).” 1 This increasing trend in US educational spending has existed for decades. It is only during economic downturns that the growth trend has stalled or had minor inversions, like mentioned in the excerpt above for 2009-10. It should also be noted that the growth trend of these dollars typically outpace the growth trend of CPI inflation. In other words, the percent of GDP that goes towards public education has been on the rise. Why the growing trends? Many believe that education is worthwhile because of the financial flexibility it affords individuals especially during the independence of adulthood. In connection with this belief, the other half of schooling systems, i.e. private institutions, have experienced even stronger growth over equivalent periods. The stronger growth is due to the fact that private institutions have a general reputation of offering a better educational experience than public institutions do. The growth trends are least positive for...
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...Cost and Benefits of Getting a College Education Abstract This paper is an analysis of pursuing college education, based on years 2004 to 2008. As a working professional, college education is one of the most important credentials needed in starting a career. Despite the limitations, a rational and ambitious individual would undoubtedly seek such a level of education. With the present economic conditions, the cost of getting a college degree is soaring high. Finances of the family are affected, not to mention the inflationary factor of prices and school fees. In this simple analysis, the costs of gaining a degree in college are identified with the provided assumptions below. With regards to the costs, the return or benefits are also given a high importance in determining the value of pursuing in college. Statement of the Problem This paper will focus on comparing the costs of getting a college education with the benefits it will earn within four years after graduation. Specifically, this study will answer the following questions (with 2004 as base year): 1. How much is the cost in today’s value of peso for pursuing a college education? - Based on a four-year undergraduate course 2. How much would I earn if I choose to work after graduating in high school and not pursue to college (forgone earnings or opportunity costs)? 3. Supposing this current year is 2004 and I have the lump sum amount of equal to the future cost of going to college, what would be its future value if I choose...
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...changing rapidly; more and more jobs require education beyond high school. College graduates have more jobs to choose from than those who do not pursue education beyond high school. Earning a college degree will enable me to start my own business, earn more money, and have self satisfaction. Upon completing college, I want to start my own business. In order to do that, I need to get a business plan together, and I need to have all of the aspects of opening and running the business worked out for the short and long term. It will be hard work, but I know I can do it because I will develop the skills, techniques, and knowledge from college to successfully operate and own my business. Also, I will have the ability to communicate effectively and be able to direct others within my business. It is exciting to know that a bachelor’s degree will help me to obtain these particular abilities and master the latest methods. In fact, owning my own business will allow me to earn more money. In owning and operating my own business, I want to be comfortable in making decisions and taking responsibility to ensure that I will be able to earn more money. Financially, earning a college degree is a wise choice. The rate of return in future earnings for every dollar a student spends on education makes up the cost of earning a degree. Although jobs with good pay are available to workers with lower levels of education, my general rule is that the more education I get, the more chances I will have...
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...ISSUES IN ACCOUNTING EDUCATION Vol. 28, No. 1 2013 pp. 77–92 American Accounting Association DOI: 10.2308/iace-50298 Going Concern Designations and GAAP versus Non-GAAP Earnings Metrics James L. Bierstaker, Thomas F. Monahan, and Michael F. Peters ABSTRACT: Many students have not spent much time studying or contemplating the importance of non-GAAP (Generally Accepted Accounting Principles) earnings to the ‘‘Street.’’ Based on the facts of an actual company and utilizing the financial information drawn from this company’s 10-K and Earnings Release, this case introduces students to the strengths and weaknesses of GAAP and non-GAAP earnings measures, and why the Street might be more interested in cash and recurring earnings in attempting to predict movements in stock price. It also provides the instructor with an opportunity to discuss the dangers of allowing firms to emphasize earnings in their press releases that are not defined by an external authoritative body (such as the Financial Accounting Standards Board [FASB]), and how this can hurt the consistency and reliability of reporting. This is an important discussion, since regulators have recently formally proposed to include non-GAAP measures in their overhaul of the auditor reporting model (Public Company Accounting Oversight Board [PCAOB] 2011). The case also familiarizes students with current auditing guidelines dealing with the going concern decision and the potential role that non-GAAP earnings can play in this decision...
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...Is a higher education worth the price of admission ? Unemployment in the United States has been a pertinent issue for the last couple years, and has been perceived as a top priority on Congress’ political agenda. The question remains as to how future generations should prepare themselves moving forward, with regards to their career plans. In other words, how economically sound is it to invest in a higher education. I have decided to explore this topic from different angles. Obviously, the main concern with institutions of higher learning, is financial debt. According to Sam Frizell’s article, “Student Loans are Ruining Your Life. Now They’re Ruining the Economy, Too”, students in the United States are “well over $1trillion in debt, and its starting to hurt everyone.” The reason for this increasing debt, is the result of increasing tuition costs of colleges and universities. Many students who are saddled with an exorbitant amount of debt, are taking longer to pay off their education costs. This issue not only affects the individual trying to pay off his debt, but also adversely affects the economy as a whole, since if students have less money as a result of paying debts, that is less money they will be spending on services and goods. This concept of higher education negatively affecting the economy, goes against conventional wisdom. Obviously, education is generally seen to be vital for the economy, and it is. As Noah Berger and Peter Fisher mention in their article “A...
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...Wage and Wage Earnings Research Process Introduction The general problem is that wage earnings and wages are categorized differently. In order to understand the specific problem one has to research various industries as well as look into what positions are being held, they have investigate the number of years experience, and kook at the current ages is of individuals who are working. With that said in order to provide research one has to understand what is meant by the research process. Today’s society understands the process of researching is asking question and searching for answers. This paper will provide research pertaining to wage earners and wages. First, define the purpose of the research and explain why researching wage earnings and wages are important. The next step is research hypothesis, meaning give three examples of possible outcomes. Knowing the purpose, understanding the question, and reviling the hypothesis will lead to defining the operational variables tested. Next is to establish the level of measurement and scale for each variable. The final objective is briefly discussing the remaining steps in the research process. Describe Purpose of the research and explain why the research problem is important Research is an organized, systematic, database, critical, objective, scientific inquiry, or investigation into a specific problem. In addition, in doing this, the business main purpose is to find answers or solutions. The research that is being preformed is...
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...College entrance, a dream of everybody, must pass college exam, so college education today to be treasured is the most important and greatest investment for own future. Why does a college education have good effect to our life in the future? Therefore, individuals with a college education have better job opportunities, earn more money and develop a better quality in life. The first positive influence is that student will be had better job opportunities if student go into college gate. Earning degree that will be opened a large door for you great job’ opportunity more widely applies into any company easily after graduating. Nowadays, in truth, some companies always wanting more and more developing recruit new human resources who have a true ability and college degree and over as a reason for having more real knowledge and more about your chosen major. Besides, you can be aware of your exceptional personality being a great benefit for you as well as an intelligent hard working person. It’s perfect for you to be recruited by some big company. It’s need why college education is more essential for student. After admitted into any company, your chance earning more money is very higher because you make a good job earning more revenue for company. From the view of the point, we know that one company must have many contracts, each of which attains amount of large revenue that push up profit and turnover leading to raise your salary if you seek more and more contracts for company as...
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