The Effect of Military Enlistment on Earnings and Education

Abstract

Military compensation is one of the Department of Defense s most important means for attracting and retaining a force of young men and women qualified to meet the nation s national security objectives. As such, it is natural to want to compare military compensation with the compensation service members might receive were they to work in the civilian economy instead. Interpreting the difference in earnings between veterans and nonveterans, though, is complicated by the fact that individuals who do and do not serve in the military differ in ways that are likely to influence their earnings. The selective nature of military service makes it difficult to determine whether the observed difference in earnings is attributable to military service or to differences in the characteristics of these individuals. In the research reported here, we refine comparisons between the earnings of enlistees and non-enlistees employing an approach first implemented by Angrist (1998). The core assumption we make is that an enlistee drawn at random from the pool of military applicants will be more similar to a randomly selected applicant that did not enlist than to a randomly selected non-applicant. Thus, we assume that differences in the earnings of military applicants who do and do not ultimately enlist will provide a better estimate of the causal effect of enlistment than will differences in the earnings of enlistees and all non-enlistees combined (i.e., non-enlisted applicants and non-applicants). We further assume that the rich set of applicant characteristics recorded on the military application record, information that is not found in the typical survey, controls adequately for any remaining differences between applicants who do and do not enlist that are correlated with earnings.

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Document Details

Document Type
Technical Report
Publication Date
Jan 01, 2011
Accession Number
ADA549955

Entities

People

  • David S. Loughran
  • Jacob Alex Lex Klerman
  • Paco Martorell
  • Trey Miller

Organizations

  • RAND Corporation

Tags

Communities of Interest

  • Biomedical

DTIC Thesaurus Topics

  • Administrative Personnel
  • African Americans
  • Business Administration
  • Data Centers
  • Department Of Defense
  • Education
  • Employment
  • Enlisted Personnel
  • Labor Markets
  • Management Personnel
  • Military Personnel
  • National Security
  • Organizational Structure
  • Personnel Management
  • Recruiting
  • Students
  • Training

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