Workers with relatively high levels of natural ability are quite likely to attend college.This can cause ________ bias when estimating educational returns because ________.

Question

Quizplus · Accepted Answer

An upward bias occurs because individuals with higher natural ability, who are more likely to attend college, would likely have higher earnings regardless of their education. This makes it seem as if the return on education is higher than it might actually be, attributing the earnings increase to education rather than inherent ability.

Workers with Relatively High Levels of Natural Ability Are Quite