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Title: The Longevity Gains of Education
Citation Type: Working Paper
Publication Year: 2010
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Abstract: This paper analyzes the longevity benefits of education in the form of improved life expectancy, monetized survivorship gains and longevity-adjusted Mincerian returns. Mortality data from the NLMS reveal a negative and statistically significant effect of schooling on eleven-year mortality in the order of -0.005 (OLS and Cox PH models), -0.016 (IV-2SLS) and -0.021 (IV Cox PH model), with region of birth and US compulsory schooling laws in place between 1925 and 1939 serving as instruments for schooling. These marginal effects induce life expectancy improvements at age 25 of 0.15, 0.31 and 0.40 years, respectively. Using a lifetime expected utility maximization model to monetize these gains yields the following longevity-adjusted Mincerian returns to schooling: 7.1% for white males (6.2% income, 0.9% longevity), 7.0% for white females (6.5% income, 0.5% longevity), 5.6% for black males (5.3%income, 0.3% longevity), and 4.9% for black females (4.6% income, 0.3% longevity). Longevity gains accrue well into late-adulthood, crest around age 50 and decrease with schooling in proportion to income gains. Analysis of the long-run trends of income and longevity returns with IPUMS data reveals marked similarities between race and gender groups from 1940 to 1990. Longevity returns are rapidly rising since 1970, but this tendency reverses for black males in 1980. Steadily increasing since 1950, Mincerian returns soar after 1980, especially among blacks. The comparison of longevity and Mincerian return estimates across NLMS and IPUMS datasets provides consistency and robustness to the results in spite of the different mortality and income measures employed.
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Authors: Sanchez, Yuri
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Institution: University of Chicago
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Publisher Location: Chicago, IL
Data Collections: IPUMS USA
Topics: Education, Labor Force and Occupational Structure
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