How beliefs and barriers shape economic opportunity.

Misbeliefs and Education Decisions by Gender

How much of the gender gap in college completion can be explained by differences in beliefs?

Women now earn more bachelor’s degrees than men across OECD countries, while men are more likely to leave college without completing a degree. This paper studies whether gender differences in subjective beliefs about graduation help explain that pattern. Using the National Longitudinal Survey of Youth 1997, I compare individuals’ expected chances of earning a four-year degree with their later enrollment and graduation outcomes.

I find that both women and men overestimate their graduation chances, but men’s beliefs are noisier signals of academic skill. Men also respond more strongly to those less-informative beliefs when making education decisions. I embed these facts in a general-equilibrium education-choice model in which subjective beliefs determine enrollment while skill and effort determine graduation. The framework shows how gendered misbeliefs can generate over-enrollment, dropout, and the misallocation of talent, and provides a basis for evaluating belief-correction policies and their wage and welfare effects.