Table 2.
Fixed parameters.
| Description | Parameter | Value |
|---|---|---|
| CRRA coefficient | α | 2.0 |
| Discount factor | β | 0.966 |
| Return to schooling | ψ | 0.1 |
| Average wage rate in the U.S. | 0.302 | |
| Interest rate | r | (1 + 0.04)6 – 1 |
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