"Parental Income, College Enrollment, and College Completion" [pdf]
An extensive literature examines the impact of parental resources on their children's human capital development during early childhood. Few studies examine such investments when children are in college. Yet, parental transfers are the most significant source of financial support for children during college. This study examines the effect of parental income on college matriculation and college completion. I provide novel evidence that, despite little effect on college enrollment rates, transitory parental income when a child is between the ages of 16 and 18 has a substantial impact on college completion rates. To rationalize this pattern, I develop and estimate a model of sequential parental investments in their children's college education. The model incorporates parents' uncertainty over (1) their own future income and (2) the likelihood their child will complete college. Parents facing uncertainty may choose to enroll their child in college, but do not necessarily fund their children's college through degree completion. Parents may also send their children to higher-quality schools that charge higher tuition, but have lower dropout rates. The estimated model reveals that higher-income parents facing uncertainty are more likely to help finance college attendance and to send their children to colleges with higher completion rates, which helps to explain why higher income affects completion but not enrollment. Moreover, using the estimated model, I show that counterfactual policies that reduce uncertainty can increase college completion rates.
"Why Not Choose the Best School? The Determinants of College Choice"
There is extensive research literature on the determinants of mismatch between student ability and college quality that focuses mostly on how students make application decisions. However, the college decision process consists of several stages and includes students’ decision-making processes when deciding on which school’s admissions offer to accept. This study uses the National Longitudinal Survey of Youth 1979 Children and Young Adults data to examine how students’ choose colleges among the schools offering admission. The analysis shows that while most students choose schools with the highest quality among the available offers, about 40% of students do not. Student’s demographic and socioeconomic backgrounds do not explain such enrollment pattern well. College characteristics in relation to student’s characteristics—the degree of overmatch (low ability students at high quality colleges) and the distance to college—affect college choice.
"Employer Learning and Multi-Dimensional Ability" with Sungah Bahk
The literature on employer learning has mostly been concerned with testing whether employers learn about true productivity of workers in various education groups, assuming that the rate of employer learning is independent of the type of job task. In this paper, thus, we ask whether the role of employer learning varies by worker task type. We build a model in which workers and firms learn about workers' multi-dimensional skills from productivity signals, where signal accuracy depends on a job's task intensity. To test the model implication that the flow of information is larger at the jobs with intensive tasks, we focus on two task measures, abstract and social tasks, constructed using data from the Occupational Information Network (O*NET). To address the endogeneity associated with job mobility, we take an instrumental variable approach, using the Markov property of Bayesian learning, where the previous periods' occupation and occupational aspiration are used as instruments. We find that employer learning depends on task intensity, especially for cognitive skills. Moreover, the degree of task-based employer learning varies across educational groups. In particular, our analyses show that cognitive tasks play a key role in employer learning for college graduates, while social tasks are more important for high school graduates.
WORK IN PROGRESS
"Occupation Switching and Human Capital Accumulation", with Jong Jae Lee
The literature on task-specific job search assumes that workers can move across occupations at no cost. This assumption contrasts the earlier literature on occupation mobility that distinguishes between general and occupation-specific human capital. We construct and estimate a dynamic structural model of task-based job search and employer learning that relaxes this condition. The workers differ in skills along several dimensions and sort themselves into jobs with heterogeneous skill dimensions. We further allow the speed of employer learning to vary by task intensity. Using this model, we quantify the effect of switching cost, the speed of employer learning, and the speed of human capital accumulation on occupation switching.
"A Life-Cycle Model of Multidimensional Skill Mismatch", with Sambuddha Ghosh
"Job Tenure and Skills in Market Equilibrium"
"College Quality, Human Capital Accumulation, and Match Quality", with Sung Ah Bahk