(Solved) : Jaeger Page 1996 Show Two Individuals 4 Years College One Doesn T Graduate One Bachelor S Q32477325 . . . .

Jaeger and Page (1996) show that if two individuals both have 4years of college but one doesn’t graduate while the other does, theone with a bachelor’s degree will earn 25% more, suggesting thatthe degree signals higher productivity levels for graduatesrelative to non-graduates.

Part A: Assume that students who attend college for four yearsacquire identical amounts of human capital, regardless of whetherthey graduate. Why might people who graduate in 4 years be moreproductive workers than those who attend college for 4 years but donot graduate?

Part B: Suggest reasons why the student with the degree might haveacquired different human capital in college than