Does Examination Hell Pay Off? the Cost-benefit Analysis of College Education in Japan
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چکیده
for comments on an earlier draft of the paper, and to the participants of the Economics Seminar at the Stockholm School of Economics for their critical feedback. I also thank the Center for East Asian Studies at the University of Chicago and the American Compensation Association for their generous financial support. ABSTRACT The obsession over college prestige and the highly competitive environment of college entry in Japan suggest that college quality plays a significant role in how individuals prepare for college. College-bound high school students undergo examination hell, and typically over thirty percent will choose the ronin option, in which they spend years in addition to high school preparing for the next year's college entrance examinations. The pursuit of college quality can thus be captured as differential investments in human capital. Some persons invest in college quality more than others because they believe that these investments will be realized through higher returns. Using the mean scores of the entrance examinations of the colleges attended as a measure of college quality, my analysis finds that college quality significantly improved the internal rate of return (IRR) among the sample of male college graduates in Japan. Moreover, my results suggest that ronin has no direct impact on earnings in and of itself, but only as an indirect effect through its improvement in the quality of the college attended. My results also show that the IRR with respect to ronin is one of diminishing returns. While the improvement in college quality from ronin must increase at an increasing rate (since the marginal cost of ronin increases at an increasing rate), in reality this improvement increases at a decreasing rate. On average, the number of ronin years which maximizes the IRR is found to be somewhere between one and two years.
منابع مشابه
Does examination hell pay off? A cost-benefit analysis of “ronin” and college education in Japan
College-bound students in Japan undergo a process of intense preparation known as examination hell. An extreme manifestation of examination hell is the ronin phenomenon. Typically thirty percent of students choose the ronin option under which they spend years in addition to high school preparing for the next year’s college entrance examinations. Using the mean scores of the entrance examination...
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