Subjective expectations and individual decisions of future graduate students

The gains derived from human capital can be affected by life –changing decisions. In my thesis I explore three of these decisions: the decision to migrate abroad (Chapter 1), the decision to migrate inside your own country (Chapter 2) and the decision to become an entrepreneur (Chapter 3). The three decisions involve a great deal of uncertainty that individuals express through expectations. I study these decisions by analyzing subjective expectations of future college graduate students. In chapter one I use the survey and data collection of Delavande and Zafar and for the second and third chapter I designed one survey and did the data collection in Bogotá, Colombia. Beyond the study of the determinants of individual migration and entrepreneurial expectations as strategies to allocate human capital, I contribute to the literature on subjective expectations. Chapter 1 investigates the role of subjective expectations and beliefs in the decision of migration of Pakistani college students to USA, Saudi Arabia and China. Findings suggest that students from different socioeconomic backgrounds and exposure to Western ideas react differently to the same potential migration destinations, not only in their preference for earnings but also in their individual preference for risks and amenities. Chapter 2 investigates what should be the incentives that a government must provide to promote the migration of future graduates from a developed urban centre to less developed ones in Colombia, as a strategy for regional development. The expected earnings, expectations about provision of schools, access to health and roads are the most important determinants to promote this specific type of migration in Colombia. Chapter 3 examines the role of earning expectations and personal characteristics on the subjective probability of becoming an entrepreneur of future graduates from Bogotá, Colombia. The expected earnings as an entrepreneur together with the preference for independence and having a previous entrepreneurial experience in the family affects positively the subjective probability of becoming an entrepreneur. These results are similar to other studies giving evidence that it is feasible to use subjective expectations as a measure of entrepreneurial intentions.