Sheepskin (or Credential) Effects

… a core term used in Economic Analysis and Atlas102


Ana Ferrer and Craig Riddell (reference below) write that sheepskin effects, also known as credential effects, refer to increases in labour market earnings associated with the completion of a diploma or degree – such as high school or university graduation.

In their abstract, Ferrer and Riddell say:

“Most labour market studies assume that the only relevant educational variable is the total number of years of education. Alternatively, the literature on sheepskin effects considers that degrees have an independent effect on the returns to education. We examine here the empirical literature that finds evidence of significant credential effects in the U.S. and Canada. The magnitude of such effects is most relevant to understanding the nature of the relationship between education and economic success.”

Atlas topic, subject, and course

Labour Markets, Transfers, and Personal Taxes (core topic) in Economic Analysis and Atlas102 Economic Analysis.


Ana Ferrer and W. Craig Riddell (2001), Sheepskin Effects and the Returns to Education, at, accessed 8 May 2016.

Page created by: Ian Clark, last modified 8 May 2016.