Education and Consumption: The Effects of Education in the Household Compared to the Marketplace

This article considers various differences between the effects of education in the marketplace and households. It shows that the household sector rewards skills that are useful at the many tasks that household members must execute, whereas the marketplace rewards skill at specialized tasks. In addition, increased supplies of more educated persons reduce returns to education in the marketplace, whereas if anything, increased supplies raise household returns to education. The greater demand over 40 years for household and market skills may have raised returns to education in households compared to those in the market sector.