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Education And Human Capital Formation Education Essay


It is no longer questioned that education and human capital formation are one of the main factors that promote economic growth. Evidence suggests that increasing human capital investment and therefore human capital stock will lead to higher income level and economic growth (Mankiw, 1994). Therefore, it is also clear that high education level and skills are important indicators of one’s economic success. Education is strongly related to later occupational attainment, earnings and good quality of life (Samuelson, 1995). Moreover, along with evolving globalization and competition, returns to academic achievements have become larger than ever and low academic achievements can been seen as a constraint on economic independence. Therefore, it would be just natural if we would see more young adults, from both genders and all ethical and social groups, aspiring to higher educational attainments and taking the advantage of possibility to gain higher returns, in that way ensuring themselves long term benefits in further life. However, evidence shows that educational aspirations and educational attainment among youth differ significantly (e.g., Qian and Blair, 1999; Betz and Fitzgerald, 1987) Therefore, the question remains what are the reasons why equally talented individuals make different academic choices and why some of them end up in lower paying jobs and careers although their abilities would allow them to occupy higher positions in labor force?

Most economists have blamed external constraints, like credit market imperfections that individuals from less advantageous backgrounds might be facing, for different educational choices (Loury 1981, Galor and Zeira 1993, Piketty 1997). However, these hypotheses trying to explain differences in education attainment might be questioned. Although in developing countries credit constraints might be the explanation of different educational attainment, this does not help to explain fully the differences in the developed world. Evidence has shown that in developed word families facing economic constraints represent only a small part of the community (Cameron and Taber 2002). Therefore, it is essential to look for other – more internal reasons that could explain different educational aspirations and choices among young adults.

For being able to understand and raise one’s aspirations it is important to understand what the determinants that influence them are. However, explaining the origins of one’s educational and occupational aspirations is not a straight forward task. They are shaped already in early childhood and are prone to changes throughout the life. Besides the initial factors that might determine one’s aspiration level, i.e., gender, socio-economical background (?), ethnicity, there are many external factors, i.e., social support and peers that influence and shape one’s beliefs in his or her abilities what further influences individual’s academic and career aspirations.

As beforehand mentioned, different educational aspirations lead to different education choices what further become one of the factors determining one’s socio-economical status. Therefore, raising aspirations for young people is an essential policy task in order to raise human capital stock, reduce poverty and have more productive, skilled labor force.

Purpose of research:

Although a considerable amount of literature has examined separate determinants of one’s educational and occupational aspirations, an explicit review overlooking most important factor influencing aspirations is still missing. The purpose of this study is to fully understand the mechanism how factors like gender, ethnicity, social-economic background (?), peers, social support and self-efficacy beliefs influence one’s academic and occupational aspirations. Further, I will ask in my thesis what the possible and existing policy measures are in order to be able to change and raise one’s aspirations. Hence, the research questions of this thesis are:

What are the determinants of educational and occupational aspiration?

What are the existing and potential policy interventions in order to raise the aspirations of young adults?


My thesis will be based on a general review covering an extensive literature and research across various disciplines (psychology, education, economics and sociology) explaining the determinants of educational and occupational aspirations (Part I) and on an overview of the policy measures that have been implemented or might be implemented in future in order to raise one’s aspiration level (Part II). The focus of the material will be qualitative studies, although a small amount of quantitative material will be included (?) when comparing some empirical data about the educational choices of individuals from different environments and the policy effectiveness in order to raise aspirations levels of young adults.

In my thesis I will concentrate on a current state of knowledge about aspirations although it is true that with a changing social context the determinants of aspiration level and their importance might change over the time. These theses will cover most of the determinants of aspirations, however, due to the limitation of research factors like culture, religion, age, sexual orientation and disability will be excluded.

Literature review of the determinants of educational and career aspirations.

1.1 Introduction

This chapter introduces the determinants of academic and career aspirations. The chapter begins with an explicit introduction of the definition of educational and career aspirations. Further, the relationship between the determinants, i.e., gender, ethnicity, socio-economical background (?), self-efficacy beliefs, peers, social support, and aspiration level is drawn by providing different views and finding from an existing literature. In the conclusion summary of the key finding has been made.

1.2 Definitions of educational and career aspirations

To be made!!

1.3 Determinants of educational and career aspirations

1.3.1 Gender:

Gender effect plays an important role in determining one’s aspiration level. Wide gender disparities, mainly in career aspirations, have been observed (Betz and Fitzgerald, 1987; Howard, 1979). Therefore, a considerable amount of literature has focused on gender-related differences in academic and career aspirations. Different explanations and theories have been provided to explain the origins of sex differences in educational and career choice (Eagly and Wood,1999; Danziger and Eden, 2007).

Different wievs exist on the nature of differences among both geder aspirations. Patton and Creed (2007) has argued that male students are more likely to aspire to higher educational attainmets and higher possitions in the labour force, while Mau and Bikos (2000) approching the same question found that girls have higher aspirations than boys. Morover, Powers and Wojtkiewicz (2004) found no differences in the level boys and girls aspire. However, overall more studies on average have shown that girls tend to have higher educational (graph #1) [1] and career aspirations than boys (e.g., Perry et al., 2009; Andres et al., 1999; Anisef et al., 2001; Butlin 1999; Clift and Vaughan 1997) and during the last decades female educational attainment and workforce has increased rapidly (Schoon, Martin and Ross, 2007), we have to admit that not too many women aspire to follow careers which are mainly associated with the opposite sex, such as science and technology. This pattern becomes even more interesting as there is no evidence observed of differences in quantitative abilities between both genders (Betz and Hackett, 1981).

Graph #1:

One of the explanations for different gender-related academic and career aspirations is that women career decisions are more complex than those of men. This arises from a bigger involvement in family and children lives or possible early pregnancy (Vonderacek et al., 1986; Eccles, 2005; Lucas, 1997). Even more, women academic and career aspirations can be shaped by existing stereotypes or strong gender identity because of social role perceptions (Eagly, 1987; Eagly and Wood, 1999; Gupta et al., 2008; Danziger and Eden, 2007).

Stereotype activation theory

Gender stereotyping is an important factor that influences person’s decision making when it comes to academic or career choice (Heilman, 2001; Nosek, Banaji and Greenwald, 2002). Gupta et al. (2008) examined the impact of stereotype activation on both gender’s intentions to follow a traditionally male-related career and found an evidence on stereotypes activation’s impact on one’s choice. Therefore, we can conclude that unconscious internalization of stereotypes plays an important role on one’s expectations and behavior (Eagly and Wood, 1999; Gupta et al., 2008). People are likely to internalize stereotypes and act according to them by performing the tasks that are associated with their own gender. Even more, the pattern is more observable if the stereotype is well known and wildly accepted in the society or culture (Heilman, 2001; Gupta et al., 2008;).

According to Day (1990) many women have high aspirations, however, they do not expect to be able to have the careers that they have aspired to. Wall et al. (1999) was examining the relationship between career expectations and career aspirations. As a result they found a significant relationship between the two variables. However, the relationship for women was found to be negative – career expectations had a negative impact on women’s aspirations. The phenomenon was explained by stereotypes in the society about gender-related jobs and women beliefs about the limits of what they possibly can achieve.

Social role and socialization theory

An important theory explaining differences in men and women career and academic aspirations is the social role theory. The theory, developed by Eagly (1987) is based on the historical division of men and women roles in the society, where women were associated with responsibilities at household while men had responsibilities concerning livelihood of the family. Consequently, expectations and career aspirations started to differ among men and women. Furthermore, the gender-related roles were usually transmitted to future generation making the distinction between appropriate gender roles in the society even stronger (Eagly, 1987).

Moreover, the academic and career aspirations are shaped by socialization processes people experience in childhood. Socialization shapes people perceptions of what is appropriate for themselves and for others, including what is expected from both genders (Seymour, 1999). Further, in early childhood children learn these roles associated with their gender which in turn shapes later perceptions about different types of jobs and influences their academic and career aspirations (Danziger and Eden, 2007). According to Eagly and Wood (1999) and Franke et al. (1997) both genders tend to adjust their expectations and aspirations in accordance with their social roles and aspire to occupations connected with their own gender (Dunne, Elliott and Carlsen, 1981). This leads to men aspiring to and occupying men-related professions while women tend to enter and aspire to more female-related studies and jobs (McNulty and Borgen, 1988; Powell and Butterfield, 2003).

Although, the social role influence on men and women has been diminishing and the gender gap in aspirations has been to decreasing (Power and Wojtkiewiez, 2004), there are still significantly less women than man in men-related study and profession fields (Powell and Butterfield, 2003) which allows us to assume that Eagly’s (1987) social role theory is one of the most influential theory that can explain the differences between men and women academic and career aspirations.

1.3.2 Ethnicity:

Research has shown that educational and career aspirations vary across different ethnical groups. However, the results found in different studies yield different conclusions. It has been wildly assumed that the highest educational aspirations are held by Asian (especially Chinese) students (e.g., Cheng and Stark, 2002; Willitts et al., 2005). Their high aspirations are formed earlier than ones for other etnical groups and are held constantly high throughout life (Kao and Tienda,1998). Most of the researches contacted have found that white boys have the lowest aspiration level between all the other ethnical and racial groups (graph#2) [2] (Dillard and Perrin, 1980; Strand, 2007) and their educational achievements during the last years have increased less than for other ethnical groups (graph#3) [3] . In the research by Dillard and Perrin (1980), it was also claimed that no significant differences in educational aspiration were found between ethnical groups for girls. White boys were found to have lower aspirations than their African American peers also in the research conducted by Wilson and Wilson (1992). However, at the same time different conclusion was made by Cook et al. (1996). In this research, when comparing middle class white males and low-income African American males, higher educational aspirations were found among white males. However, this conclusion does not seem straight-forward as the differences might be also explained by the economical factors.

Graph#2: Graph#3:

Although, Strand (2007) has found that Black Caribbean and Black African students might have higher academic aspirations than White students, their higher educational attainment seems to be much lower (graph#4) [4] . Therefore, the question raises – what are the factors creating this aspiration-attainment gap that does not allow high aspiration transformation into high achievements?


There are three major views, respectively structuralist and culturalist and rationalist, which tend to explain differences in educational attainment between different ethnical groups.

Structuralist theory

According to structuralist view differences in educational choices can be explained by external constraints. To be finished (!)

Culturalist theory

According to culturalist point of view, differences in educational choices rise from internal factors, like internalization of social norms and constraints. Ethnical groups have cultural differences that can result in different attitude towards schooling and achievement (Caplan et al. 1991). Following Bordieu and Passeron (1964) the main reason why To be finished (!)

Rational action theory (RAT)

To be finished (!)

1.3.3 Ability and self-efficacy:

Although many factors that influence one’s academic and career aspirations are external, e. g., peer effect, social stereotyping etc., it has been proven that individual’s self belief and ability has the same importance on the final outcome (Brown & Lent, 2006). The correlation between one’s ability and educational aspirations has been examined by Nauta et al. (1998). They found a positive effect of GPA on student’s further academic and career aspirations (Nauta et al., 1998). Research has shown that child’s ability at age 7 is positively correlated with his aspirations at age 11, but ability at age of 11 influences child’s aspirations at age of 16 (Bond and Saunders, 1999). Therefore, we can conclude that one’s ability is positively correlated to the academic and career aspirations. However, we cannot educe that ability alone influences aspiration level. Nauta et al. (1998), Lent and Brown (1996) and Bandura et al. (2001) have shown the importance of self-efficacy, i.e., one’s belief that she or he is capable of producing certain level of performance to attain certain goals (Bandura, 1994). Thus, the initial ability has a strong effect on one’s aspirations; however, the ability is reinforced by one’s self-efficacy.

Students who have high self-efficacy are more productive, efficient and confident about their performances than their peers with the same ability but lower self-efficacy. It has been also shown that they put more effort and are more concentrated on the task than others, as well as they are more committed to their goals (Bandura, 1997; Schunk and Pajares, 2005). Therefore, the ones with high self beliefs perform better and based on better outcomes have higher further academic and career aspirations (Brown & Lent, 2006) (graph#4) [5] .

However, evidence has shown that as person gets older, his or her ability-related belief decrease as one faces more and more complex tasks. As self-efficacy beliefs play an important role in one’s academic and career aspirations, this can serve as an explanation why originally confident students may start seeing constraints on educational choices and later careers (Bandura, 1997; Bandura et al., 2001).

In the next sections (1.3.4; 1.3.5; 1.3.6) external factors, i.e., peer effect, community effect and family’s, teachers’ expectations, influencing one’s self efficacy will be discussed.

1.3.4 Peer effect:

Another variable studied in literature concerning the determinants of academic and career aspiration level is the peer effect. The peer effect refers to the influence significant others have on one’s aspiration and level of achievement, e.g., by providing one with feedbacks, models or norms how they should behave, think and act in certain situations. Peer groups are where young adults develop their identities (Black, 2002). Although, some have argued that children aspirations are more likely to be shaped by the characteristics of a particular family than by the characteristics of peers (Duncan et. al., 2001), relevant amount of literature shows that peers play the major role of shaping one’s achievements and educational aspirations (Peterson et al.,1986; Willms 1986).

A relevant contribution of proving the significance of the peer effect on one’s academic aspiration was provided by Ide et. al. (1981). In their analysis they examined ten studies published form 1966 to 1978 that concerned the peer effect on academic achievements and aspirations. In all the studies they found a correlation between individual’s and peers’ academic achievements. This finding is consistent with Downs & Rose (1991) who argue that peer effect is contributing to the construction of one’s behavior and level of achievements.

Another, slightly different view is hold by Haller and Butterworth (1960) looks more critically on the straight forward correlation between one’s educational and career aspirations and peer influence. They emphasizes that the initial factors, like characteristics and family backgrounds, could play big role in bringing together similar individuals in that way forming homogeneous groups of peers. According to Jonsson and Mood (2008) children with high economic aspirations and achievements are likely to connect with those sharing the same interests and aspirations.

1.3.5 Social support:

Another determinant of one’s academic and career aspirations is the social support, i.e., peers, teachers and family (Wall et al., 1999). As discussed earlier peer effect has a significant role in shaping one’s aspirations (e.g. Black, 2002; Peterson et al., 1986; Willms, 1986), however, a significant amount of literature points out the importance of family and teacher influence on children long term decisions, e.g., career considerations (Jurkovic and Ulrici, 1985; O'Brien, 1990; Furman and Buhrmeister, 1992; Duncan et. al., 2001; Wall et al., 1999). It is believed that teachers and parents can positively influence one’s confidence and beliefs of his or her abilities, thus, persuading that the person is capable of being successful in further life (Van Auken and Stephens, 2006).

According to Wall et al. (1999) parents as a support and role model have the biggest influence on one’s conception about educational and career opportunities. Parents’ social support is directly linked with students’ school experiences, achievements and behavior (Nurmi, 1987). There is also a positive correlation between parents aspiration for their children and aspirations’ of children themselves (e.g., Davies and Kandel, 1981; Hossler and Stage, 1992). Family support can encourage student to devote bigger effort to learning and school tasks (Gilbert, Barr, Clark, Blue, and Sunter, 1993). It is also a tendency observed that children who have the highest self-efficacy are the ones with the biggest family social support (Dubow and Ullman, 1989). In contract, the ones with low family cohesion are more exposed to depression and low self-efficacy and self-esteem (Cauce, Hannan, and Sargeant, 1992; Hirsch and DuBois, 1992; Moran and Eckenrode, 1991). Moreover, Wall et al. (1999) showed that there is stronger correlation between young male aspirations and the family support than the one for girls. In his research Roper (2008) showed that parent expectations and student GPA are related (Table #1). Children with higher grades tended to have parents with higher aspirations and expectations for their children.

Table #1

A significant amount of literature has discussed parents and family role in shaping one’s aspirations, however, body of literature about teachers’ expectation influence on one’s aspirations is rather small. Cheung (1995) found evidence on positive teacher influence on one’s academic and achievement expectations. Teacher support has shown to have bigger influence on women and student from lower socio-economical backgrounds perceptions of academic and career opportunities (Ellis and Lane, 1963; Wall et al., 1999). However, it is often blamed that teachers have insufficient expectations for their students, especially for students in rural areas and for certain student groups (Hilliard III, 1991; Bishop, 1989). It is researched that teachers tend to establish better contact and attitude forward students with higher ability (Bamburg, 1994). This is seen as a problem because children tend to internalize and adopt teacher perceptions about their abilities which as a result in case of low teacher expectations can lead to pshyhological constraints for self-effiacy and self-esteem (Raffini, 1993).

A slightly different view on the importance of teacher expectation influence on one’s academic aspirations is held by Sewell et al. (1969). By researching significant others influence on student aspirations they found only a small and unsignifficant correlation between teachers expectations and student beliefs of their abilities and academic and further career aspirations. This view is supported also by Williams (1972) and Alexander and Eckland (1973). However, Williams (1971) in his study argued that teacher influence might change over time and differ among sexes.

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