Does Raising the Principal's Wage Improve the School's Outcomes? Quasi‐experimental Evidence from an Unusual Policy Experiment in Israel

This paper reports estimates of the causal effects of a 50 percent increase in the salary of headmasters of high schools in Israel. The results suggest that the program led to significant improvements in twelfth‐grade students' academic achievements. However, the effect was relatively modest, comprising increases of about 5–10 percent in the school mean matriculation rate, average score and number of subjects and credit units taken in matriculation programs. Based on these results and the lack of evidence regarding the effect of increasing teachers' salary, it seems that priority should be given to paying higher wages to school principals.     

Can neighbourhoods change the decisions of youth on the margins of university participation?

Abstract This paper uses the Youth in Transition Survey (YITS) to estimate the relationship between neighbourhoods and university participation among Canadian youth. Neighbourhood quality is proxied by the fraction of neighbourhood adults with a Bachelor's degree. The estimated effect is identified using neighbourhood variation within high schools. The paper also tests whether the effects differ by family background and children’s reading skills. Neighbourhoods do not affect university participation among youth drawn from the tails of the socio‐economic distribution. Neighbourhoods have the largest effect on youth drawn from the middle of the socio‐economic distribution who also have above median reading skills.     

Is Extending Compulsory Schooling Alone Enough to Raise Earnings? Evidence from French and British Compulsory Schooling Laws*

In this paper, I compare two reforms that raised the minimum school‐leaving age to 16 in France (1967) and in England and Wales (1972). Using a regression discontinuity design, I find that while the reform in England and Wales led to a 6?7 percent increase in hourly wages per additional year of compulsory schooling, the impact of the change to French law was close to zero. The results suggest that the major difference between the two reforms was that the fraction of individuals holding no qualifications dropped sharply after the introduction of the new minimum school‐leaving age in England and Wales, whereas it remained unchanged in France.     

Job search and academic achievement

The paper develops a structural model for the labor market behavior of students entering the labor market. We explicitly model the trade-off between devoting effort to studying and to job search. Furthermore, we allow for on-the-job search. The model is estimated using a unique data set of individuals who completed undergraduate education in the Netherlands between 1995 and 2001. Our estimation results show that labor market returns of high grades are low. Wage increases between jobs are explained by labor market friction rather than returns of early work experience. Our results indicate that a 1 percentage point decrease in the unemployment rate increases wage offers on average by 3 percent, but that the amount of job search effort is not very sensitive to business cycle fluctuations. Policy simulations show that study effort and hence academic achievement are much more sensitive to financial incentives than job search effort and labor market outcomes.     

RISK AVERSION AND FIELD OF STUDY CHOICE: THE ROLE OF INDIVIDUAL ABILITY

Does the choice of field of study depend on individual risk aversion? The direction of the relationship between individual risk attitudes and type of university degree chosen is potentially ambiguous. On the one hand, risk averse individuals may prefer degree courses which allow high returns in the labour market; on the other hand, if these degrees expose students to a higher probability of dropping out, those who are more risk averse may be induced to choose less challenging fields. Using data from a sample of students enrolled at a middle‐sized Italian public university in 2009, we find that, controlling for a large number of individual characteristics, more risk averse students are more likely to choose any other field (Humanities, Engineering, and Sciences) rather than Social Sciences. We interpret this result bearing in mind that some of these fields, such as Humanities, involve a reduction in the risk of dropping out, while others (such as Engineering and Sciences) involve a lower risk in the labour market. It also emerges that the effect of risk aversion on degree choice is related to student ability. Risk averse students characterized by high abilities tend to prefer Engineering, while the propensity of risk averse students to enrol in Humanities decreases when ability increases, suggesting that the attention paid to labour market risks and drop‐out risk varies according to student skills.     

Estimating the benefit of high school for university‐bound students: evidence of subject‐specific human capital accumulation

Numerous studies suggest that the value of high school education is large for potential dropouts, yet we know much less about the benefits for students who will go on to post‐secondary education. To help fill this gap I measure, using a recent Ontario high school reform, the value‐added (in terms of university grades) of an extra year of high‐school mathematics for university‐bound students. The estimated benefit is small for these students: 2.3 points on a 100‐point scale. This evidence helps to explain why the literature has found only modest effects of taking more mathematics in high school on wages.     

Can Small Class Policy Close the Gap? An Empirical Analysis of Class Size Effects in Japan

Can smaller classes lead to better educational outcomes and greater equality in achievement? We estimate the causal effects of class size on achievement tests by using discontinuous changes in class size under the Japanese public compulsory education system. We employ a value‐added model that uses achievement tests conducted at two different times during the same school year. Our results show that a reduction in class size has significantly positive effects on Japanese language test scores in the sixth grade, especially at schools in wealthy areas. However, we find no evidence that a universal small class policy closes the achievement gap among schools.     

Resource constraints and educational attainment in developing countries: Colombia 1945–2005

In this paper, I investigate the extent to which secondary and higher education supply constraints affected aggregate educational attainment in Colombia for cohorts born between 1945 and 1981. As was the case in many other countries after World War II, in Colombia, industrialization, urbanization and rapid population growth increased the demand for education and the return to schooling. Although educational expenditures from the central government and the states increased after the 1950s, secondary and tertiary schools' per-pupil inputs declined. Using variation in cohort size within states and over time to proxy for changes in education demand, I find that for cohorts born after 1945, a 10% increase in cohort size reduced high school completion rate by 3%, the college completion rate by 4% and average years of schooling by 1%. Compared to women's educational attainment rates, changes in cohort size had greater negative effects on men's rates.     

Mother's education and child development: Evidence from the compulsory school reform in China

This paper investigates the causal impact of mother's schooling on various outcomes of adolescent development by exploiting the temporal and geographical variations in the enforcement of compulsory schooling laws in China. Using data from China Family Panel Studies, we find that mother's education increases adolescents’ school enrollment, math test scores, college aspiration, and internal locus of control related to education. Mother's education also improves adolescent mental health status and reduces the incidence of underweight. We also find considerable gender heterogeneity in the effects of mother's education. The results further indicate that mother's education leads to an increase in family resources for children and an improvement in maternal mental health and parenting, which we interpret as potential mechanisms behind our findings.     

Schooling as a Lottery: Racial Differences in School Advancement in Urban South Africa

This paper analyzes the large racial differences in progress through secondary school in South Africa. Using recently collected longitudinal data we find that grade advancement is strongly associated with scores on a baseline literacy and numeracy test. In grades 8-11 the effect of these scores on grade progression is much stronger for white and coloured students than for African students, while there is no racial difference in the impact of the scores on passing the nationally standardized grade 12 matriculation exam. We develop a stochastic model of grade repetition that generates predictions consistent with these results. The model predicts that a larger stochastic component in the link between learning and measured performance will generate higher enrollment, higher failure rates, and a weaker link between ability and grade progression. The results suggest that grade progression in African schools is poorly linked to actual ability and learning. The results point to the importance of considering the stochastic component of grade repetition in analyzing school systems with high failure rates.     

Post‐secondary attendance by parental income in the U.S. and Canada: Do financial aid policies explain the differences?

We examine the extent to which tuition and needs‐based aid policies explain important differences in the relationship between family income and post‐secondary attendance relationships between Canada and the U.S. Using data from recent cohorts, we estimate substantially smaller attendance gaps by parental income in Canada relative to the U.S., even after controlling for family background, cognitive achievement, and local‐residence fixed effects. We next document that U.S. public tuition and financial aid policies are actually more generous to low‐income youth than are Canadian policies. Equalizing these policies across Canada and the U.S. would likely lead to a greater difference in income‐attendance gradients.     

Search equilibrium and social and private returns to education

Social and private returns to education are computed using the structural estimates of an extended Burdett-Mortensen search equilibrium model. The extension includes different skill groups linked via a production function with variable degree of homogeneity, allowing thereby for a unimodal earnings density with a decreasing right tail. We find that the decreasing unemployment risk for higher skill groups and the absence of tuition fees in Germany increase private returns and lead to a too large share of high skilled individuals in the workforce, which is suboptimal from the social point of view.