9of19 - Investment in Schooling and Training - The Labor Market

GARY BECKER

This the ninth lecture in the "Lectures on Human Capital" series by Gary Becker. This series of lectures recorded during the Spring of 2010 are from ECON 343 - Human Capital, a class taught every year by Gary Becker at the University of Chicago. In this class, Becker expounds upon the theory of Human Capital that he helped create and for which he won the Nobel Prize. Please see attached lecture notes, video annotations, and reading list for more information.

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Professor Becker continues to discuss the model of investment in education introduced in the previous lecture. In this lecture, he carefully lists, describes and analyses each of the parameters involved in the decision that individuals make when going or not to college. He also works through some comparative statics exercises about these parameters.

In this lecture, Becker also discusses a number of stylized facts about the labor market for man, women, and minorities including participation rates, wage differentials and how these have changed over time.

Key concepts: discount factor, foregone earnings, lifetime earnings differential, life expectancy, return to education, basic facts about the labor market.

Main discussions:
• Lecture 9, (09:50-10:55): Professor Becker discusses the decision to invest in education.
• Lecture 9, (49:05-54:30): Professor Becker discusses the discrimination against women in the marketplace.
• Lecture 9, (01:14:00-01:24:25): Professor Becker discusses the development of the wage differential between men and women in the 20th century.

References:
• Chapter V: Rates of Return from College Education in Becker, Gary. 1974. Human Capital. Third ed. pp. 161-204.
• Salvador Navarro Lozano. Notes on Gary Becker's Human Capital and the Economy. pp. 18-21.

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Lecture Notes:
https://mindonline.uchicago.edu/media/ssd/econ/becker/Lecture_Notes-Human_Cap...

Reading List:
https://mindonline.uchicago.edu/media/ssd/econ/becker/Sp2007readinglist.pdf

Video Annotations:

https://mindonline.uchicago.edu/media/ssd/econ/becker/Annotations_to-videos-H...

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• investment
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