Subjective and projected returns to education

There is significant heterogeneity over high school students in the wage and employment rate returns to education. I evaluate this heterogeneity using subjective returns derived from a data set of high school juniors and seniors in Washington State. Variation over observables in projected returns estimated using observed data is uncorrelated with variation in subjective returns elicited by directly asking students about their beliefs. These results mean that returns estimated using observed data are likely a very weak proxy for student beliefs.