COSTS AND REVENUES OF INVESTMENT IN ENTERPRISE-RELATED SCHOOLING

In this paper a general specification of the wage equation is used to derive a marginal revenue equation for enterprise-related schooling. T he optimal amount of investment in enterprise-related schooling is fou nd by equating the marginal revenues and marginal costs. For the empir ical analysis the wage equation, the marginal costs equation and the m arginal revenue equation are estimated simultaneously. The empirical r esults show that both the marginal cost and the marginal benefits of t raining vary with a worker's level of ability. For a reference male wh o participates in ERS, the wage increase is about 34% of the average w age rate of participants.