From Poverty to Prosperity: College Education, Noncognitive Abilities, and First-Job Earnings

Abstract

Previous studies have attributed the impact of the weaker family background among college graduates either to the selective admission process or to the signaling effect of a college diploma in the labor market. In this paper, I aim to provide an alternative explanation by focusing on the human capital accumulation during college. Based on data from the Beijing College Students Panel Survey, I employ growth curve models to reveal that students from poor households gradually caught up with their nonpoor counterparts in terms of noncognitive abilities during their four years of college education, which eventually compensated for their potential disadvantage in terms of first-job earnings. The empirical evidence suggests, in addition to sorting and certifying, higher education can weaken the impact of a disadvantaged family background by offering an open and fair stage for students of different social origins, helping them develop their noncognitive skills in their future careers.