Date of Award

12-2015

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Legacy Department

Policy Studies

Advisor

Simon, Curtis J

Committee Member

Tollison, Robert

Committee Member

Ulbrich, Holley

Committee Member

Stewart, Joseph

Abstract

On October 4th 1957, the Soviet Union launched the world’s first man-made satellite, Sputnik 1, into an elliptical low Earth orbit. This surprise triggered an arms race between the United States and the Soviet Union, and science-oriented educational reform in the U.S. The Sputnik swung off of the U.S. in military, politics, policies, and education. The Sputnik woke Americans up from complacency came from technology, science, and educational superiority. Educational reform started with emphasizing science and defense education and it was expanded to educations at all level. Early reforms, National Science Foundation (NSF), National Defense Education Act (NDEA) of 1958, were focused on science and defense education during Eisenhower. Domestic programs, Civil Rights and Great Society, diffused educational policy to produce more general human capitals for improve poverty and economic growth during Kennedy and Johnson. Higher Education Act (HEA) of 1965 was enacted for supporting postsecondary education. I insist that these policy outputs have contributed to the increase in the supply of college graduates dramatically since 1960. This study begins with emphasizing the Soviet launching of Sputnik and educational reform in early 1960s in U.S. as a cause and effect relationship. Analysis focuses on the policy process of educational reform by applying Kingdon’s multiple streams model, and on the economic effects of increase in the supply of college graduates by applying Acemoglu’s theory, the pooling and separating equilibria (1999). According to Acemoglu, economy transits from initial pooling equilibrium to separating equilibrium as supply of high skilled labor increases and thus labor markets show different patterns in unemployment rates and wage structures for skilled and unskilled, and job mismatch. I find that occupational segregation at the state labor markets increases corresponding to supply of college graduates, and overeducation decreases as occupational segregation increases. Moreover, occupational segregation has positive wage effects and wage penalty from overeducation becomes smaller in states where occupations are more separated between the skilled and the unskilled. College graduates earn more wage premiums in states where occupations are more separated between the skilled and the unskilled.

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