Seminar

The return to medical school in a regulated labor market: Evidence from admission lotteries

Bas Van Der Klaauw (University of Amsterdam - Tinbergen Institute)

December 8, 2011, 17:00–18:30

Toulouse

Room Amphi MB II

Econometrics Seminar

Abstract

Many countries regulate the supply of doctors by centrally fixing the number of places in medical schools. We estimate the return to gaining access to medical school in such a setting, by exploiting that admittance to medical school in the Netherlands is determined by a lottery. The earnings gain of being a physician compared to people's second choice is at least 25 percent. Estimated wage profiles suggest that the returns are even higher in the long run: twenty years after participating in the first lottery the earnings difference is almost 80 percent. The size of this rent does not vary with ability or gender. Joint with Nadine Ketel, Hessel Oosterbeek & Edwin Leuven.