Alex T Tabarrok wrote:
> Bryan's question, however, can be rephrased as not how do you explain
> the data (low ability bias and high discount rate bias) but why is it
> that ability bias appears low?
Ability bias isn't really low. Using the NLSY data, for example,
controlling for AFQT scores reduces the naive estimate of the return to
education from 12.6% to 7.5%. Ability bias *after* controlling for
intelligence might be low, though.
> In other words aren't there good grounds
> for thinking that ability bias is large? And if so how is it that this
> doesn't show up in the data?
>
> Alex
>
> --
> Alexander Tabarrok
> Department of Economics, MSN 1D3
> George Mason University
> Fairfax, VA, 22030
> Tel. 703-993-2314
>
> and
>
> Director of Research
> The Independent Institute
> 100 Swan Way
> Oakland, CA, 94621
> Tel. 510-632-1366
--
Prof. Bryan Caplan
Department of Economics George Mason University
http://www.bcaplan.com [EMAIL PROTECTED]
"He wrote a letter, but did not post it because he felt that no one
would have understood what he wanted to say, and besides it was not
necessary that anyone but himself should understand it."
Leo Tolstoy, *The Cossacks*
