Returns to education and skill premiums: Estimation and biases associated with the case of Argentina

Abstract

This article aims to empirically analyze returns to education and skill premiums in employed wage earners in Argentina between 2003 and 2014, under three alternative specifications of the Mincer equations. The study examines the comparative evolution of these returns during the period and identifies biases in the estimates of the proposed income equations. The final objective of this exercise is to decide which alternative is the empirically most appropriate estimate for the case of Argentina in the analysis period. Results show that the Poisson maximum likelihood model, applied to the traditional Mincer approach, generates consistent estimates of returns to the attributes of workers.