While uncertainty abounds in almost any decision on investment in schooling, it is mostly ignored in research and … virtually absent in labour economics text books. This paper documents the scope for risk, discusses the tough disentanglement of … heterogeneity and risk, surveys the analytical models, laments the absence of a good workhorse model and points out the challenges …

to college households in terms of welfare. Chapter 2 disentangles the effect of demographic change on returns to risk …. Chapter 3 develops a method for computing transitional dynamics in heterogeneous agent models with aggregate risk if these …