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ERIC Number: ED571788
Record Type: Non-Journal
Publication Date: 2016-Dec
Pages: 19
Abstractor: As Provided
The Fixed-Effects Model in Returns to Schooling and Its Application to Community Colleges: A Methodological Note
Dynarski, Susan; Jacob, Brian; Kreisman, Daniel
Center for Analysis of Postsecondary Education and Employment
The purpose of this note is to develop insight into the performance of the individual fixed-effects model when used to estimate wage returns to postsecondary schooling. We focus our attention on the returns to attending and completing community college. While other methods (instrumental variables, regression discontinuity) have been used to estimate the returns to four-year colleges, the individual fixed-effects estimator has primarily been employed in the analysis of community colleges. Using data from Michigan, we test the common-trends assumption that underlies the individual fixed-effects estimation strategy. We find that the common-trends assumption is violated in our sample. We suggest an estimation strategy that allows for individual-specific pre-trends in earnings. Including these trends substantially alters the estimated returns.
Center for Analysis of Postsecondary Education and Employment. Teachers College, Columbia University, 525 West 120th Street Box 174, New York, NY 10027. Tel: 212.678.3091; e-mail:; Web site:
Publication Type: Reports - Research
Education Level: Two Year Colleges; Higher Education; Postsecondary Education
Audience: N/A
Language: English
Sponsor: Institute of Education Sciences (ED)
Authoring Institution: Center for Analysis of Postsecondary Education and Employment (CAPSEE)
Identifiers - Location: Michigan
IES Funded: Yes
Grant or Contract Numbers: R305C110011