This paper proposes a nonparametric method of estimating marginal treatment effects in heterogeneous populations. Building upon an insight of Heckman and Vytlacil, the conventional treatment effects model with heterogeneous effects is shown to imply that outcomes are a nonlinear function of...

A long-standing issue in the literature on education is whether marginal returns to education fall as education rises. If the population differs in its rate of return, a closely related question is whether marginal returns to higher education fall as a greater fraction of the population enrolls....