Private returns of education in the urban araes of Iran: a quantile regression analysis

Document Type : Research Paper


1 Associate Professor,Faculty ofManagement and Economics,Sharif University of Technology

2 MA Economics


Evidence from Iranian Households’ Expenditures and Income Survay(IHEIS) in urban area shows that, average of real hourly wage against the schooling years is declining in the right tail of wage distribution between 1384 and 1390 (2005 and 2011). A tentative justification for this observation is that the private rate of return to education at upper quantiles and higher years of schooling have reduced over the period. We estimate a Mincerian generalized wage equation by making use of quantile regressions with controlling for sample selection problem. Results indicate that the private rate of return to education has decreased between 1390 and 1384. Also educational attaionment reduces wage gap between the upper and lower deciles for females, however a reverse relation is observed for males.
Keywords: wage inequality, private return to education, quantile regression, sample selection bias
JEL Classification: J31, J23, J24, I21



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