The Labor Market Returns to Reversing High School Dropout

Abstract

More than 18 million adults in the US have no high school credential. Full diplomas are less common for adults than GEDs but potentially more valuable. We compare graduates of a network of adult high schools to those who apply but do not enroll. Over 5 years, earnings increase by 39% more for graduates. We address selection into graduation by conditioning on 5 years of pre-application earnings and comparing to students who exit after positive shocks. Human capital is a mechanism. Graduates receive more credentials and switch from hospitality to healthcare jobs.

Keywords: high school dropout, high school diploma, returns to education, human capital, GED

JEL Classification: I24, I26, J24