Education and Differences in Postschool Human Investment: Comment

In a recent paper in this journal Knapp (1977) examines the relationship between education and the intensity and time span of postschool human investment. By utilizing the Mincer (1974) specification of the human capital earnings function, and a technique developed in Knapp and Hansen (1976), Knapp estimates that the initial investment ratio upon entering the labor market, ko, is lower for those with more education. Further, he argues that the period of positive net investment, T, is longer for those with more schooling. The purpose of this note is to show that the use of an alternative estimating procedure indicates that the investment ratio is higher for those with more education. This result is found to hold when we use coefficient estimates from Knapp's own data and when we employ data from the one-in-one-hundred file of the 1970 Census. In addition, estimates of T obtained from the Census data indicate that the net investment span is shorter, rather than longer, for those groups with more education. Knapp uses the following specification of the human capital model suggested by Mincer (1974, p. 91), where the proportion of potential earnings invested in postschool training declines linearly from some initial fraction, ko, to zero after T years of positive net investment (such that k, = ko(l tiT)):