nep-edu New Economics Papers
on Education
Issue of 2006‒08‒12
nine papers chosen by
Joao Carlos Correia Leitao
Universidade da Beira Interior

  1. Higher education: Time for coordination on a European level? By Laura Thissen; Sjef Ederveen
  2. Education and Intergenerational Mobility: Evidence from a Natural Experiment in Purerto Rico By John C. Bluedorn; Elizabeth U. Cascio
  3. Sheepskin or Prozac: The Causal Effect of Education on Mental Health By Arnaud Chevalier; Leon Feinstein
  4. Enhancing Portugal's Human Capital By Stéphanie Guichard; Bénédicte Larre
  5. New Technology in Schools: Is There a Payoff? By Stephen Machin; Sandra McNally; Olmo Silva
  6. Successful knowledge policies By Maarten Cornet; Fré Huizinga; Bert Minne; Dinand Webbink
  7. Consumer-finance myths and other obstacles to financial literacy By William R. Emmons
  8. Handedness and Earnings By Christopher S. Ruebeck; Joseph E. Harrington, Jr.; Robert Moffitt
  9. Human capital, trade and long-run productivity. Testing the technological absorption hypothesis for the Portuguese economy, 1960-2001 By Aurora A.C. Teixeira; Natércia Fortuna

  1. By: Laura Thissen; Sjef Ederveen
    Abstract: Education has always been regarded as a national matter. According to the subsidiarity principle power may only be shifted to a higher level of coordination when solid arguments exist that this will improve welfare. This paper aims at answering the question if these arguments exist. We find no support for economies of scale, i.e. larger countries do not necessarily provide higher quality education; nor do larger schools. Empirical evidence for human capital externalities through student mobility is scarce. Concluding, we find little support for European coordination of higher education. However, there is evidence that student mobility is a precursor for labour migration. Uniformizing the structure of higher education in the EU, and making educational programs more transparent, may therefore be defended from this perspective. Quality does matter for students, and student mobility is increasing. This may be beneficial to labour mobility.
    Keywords: Subsidiarity; European coordination; Higher education; Student migration
    JEL: F22 H87 I2 J61
    Date: 2006–07
  2. By: John C. Bluedorn (Dept of Economcis, University of Oxford); Elizabeth U. Cascio (University of California, Davis and NBER)
    Abstract: The existence of intergenerational spillovers to public investments in schooling is often assumed in policy discussions regarding economic development. However, few studies to date have forwarded convincing evidence that externalities exist for developing countries. In this paper, we address this issue using the arguably exogenous schooling consequences of a major hurricane strike on Puerto Rico in the 1950s. Using data from the US. Census of Population for Puerto Rico, we first find that individuals on to margin of school entry at the time of the storm and residing in the most exposed regions of the island had significantly lower levels of education as adults than their counterparts in less exposed regions. Using the interaction of wind speed and age at the time of the storm as an instrument, we then find that maternal education is related to the probability that a child speaks English. Our estimates imply an additional year of education raise the probability that a child speaks English by between 4.3 and 4.5 percentage points, c approximately 24 to 28 percent. We find no conclusive evidence that parental education increases the probability that a child is enrolled, literate, or in an age-appropriate grad, On balance, these findings suggest that education is responsible at least in part for the persistence of human capital across generations.
    Keywords: education, intergenerational mobility, natural experiment, hurricane
    JEL: J62
    Date: 2005–04–01
  3. By: Arnaud Chevalier (University of Kent, CEE, London School of Economics, University College Dublin and IZA Bonn); Leon Feinstein (Institute of Education and CEE, London School of Economics)
    Abstract: Mental illness is associated with large costs to individuals and society. Education improves various health outcomes but little work has been done on mental illness. To obtain unbiased estimates of the effect of education on mental health, we rely on a rich longitudinal dataset that contains health information from childhood to adulthood and thus allow us to control for fixed effects in mental health. We measure two health outcomes: malaise score and depression and estimate the extensive and intensive margins of education on mental health using various estimators. For all estimators, accounting for the endogeneity of education augments its protecting effect on mental health. We find that the effect of education is greater at mid-level of qualifications, for women and for individuals at greater risk of mental illness. The effects of education are observed at all ages, additionally education also reduces the transition to depression. These results suggest substantial returns to education in term of improved mental health.
    Keywords: returns to education, mental health
    JEL: I12 I29
    Date: 2006–07
  4. By: Stéphanie Guichard; Bénédicte Larre
    Abstract: The lack of human capital in Portugal has become a key obstacle to higher growth. This paper discusses the performance of education and training services in Portugal and shows that improvements are needed to narrow the significant human capital gap with other OECD countries. Despite progress in the past decades, Portuguese children spend comparatively few years in formal education, and they do not perform as well as children from other OECD countries. Adults, especially the least educated, do not participate enough in lifelong learning and training programmes. This situation does not stem from a lack of resources devoted to education and training but from inefficiencies and misallocation of spending, and weaknesses in the quality of the services that compound the low starting point of Portugal regarding education. Modernizing the Portuguese economy therefore requires a broad reform which increases human capital at all levels. The ongoing efforts of the authorities in the three areas - basic and upper secondary education, tertiary education and adult training - go in the right direction but implementation remains a challenge. <P>Accroître le capital humain au Portugal <BR>L'insuffisance du capital humain au Portugal est devenue un des obstacles clé à une croissance plus forte. Ce papier discute la performance des services éducatifs et de formation des adultes au Portugal et montre que, pour réduire significativement le retard en terme de capital humain vis-à-vis des autres pays de l'OCDE, ces services doivent être améliorés. En dépit des progrès accomplis au cours des dernières décennies, les jeunes Portugais passent relativement peu d'années dans le système éducatif et n'obtiennent pas d'aussi bons résultats que les jeunes des autres pays de l'OCDE. Les adultes, et en particulier les moins éduqués, ne participent pas suffisamment aux activités de formation tout au long de la vie. Cette situation ne tient pas à une insuffisance des ressources consacrées à l'éducation, mais à un manque d'efficience, à une mauvaise affectation des dépenses et à une mauvaise qualité des services éducatifs qui viennent amplifier le retard initial dont souffre déjà le Portugal sur le plan de l'éducation. La modernisation de l'économie portugaise requiert donc une réforme de grande ampleur qui accroisse le capital humain à tous les niveaux. Les efforts actuels des autorités dans les domaines de l'éducation primaire et secondaire, de l'éducation tertiaire et de la formation des adultes vont dans la bonne direction, mais leur mise en oeuvre est un défi.
    Keywords: human capital, education, capital humain, Portugal, Portugal, éducation, adult training, formation des adultes
    JEL: I20 I21 I22 I23 I28 J24
    Date: 2006–07–28
  5. By: Stephen Machin (University College London, CEE, CEP, London School of Economics and IZA Bonn); Sandra McNally (CEE, CEP, London School of Economics and IZA Bonn); Olmo Silva (CEE, CEP, London School of Economics, European University Institute and IZA Bonn)
    Abstract: Despite its high relevance to current policy debates, estimating the causal effect of Information Communication Technology (ICT) investment on educational standards remains fraught with difficulties. In this paper, we exploit a change in the rules governing ICT funding across different school districts of England to devise an instrumental variable strategy to identify the causal impact of ICT expenditure on pupil outcomes. The approach identifies the effect of being a ‘winner’ or a ‘loser’ in the new system of ICT funding allocation to schools. Our findings suggest a positive impact on primary school performance in English and Science, though not for Mathematics. We reconcile our positive results with others in the literature by arguing that it is the joint effect of large increases in ICT funding coupled with a fertile background for making an efficient use of it that led to positive effects of ICT expenditure on educational performance in English primary schools.
    Keywords: Information and Communication Technology (ICT), pupil achievement
    JEL: H52 I20 I28 J24
    Date: 2006–07
  6. By: Maarten Cornet; Fré Huizinga; Bert Minne; Dinand Webbink
    Abstract: This article discusses several policy options in the fields of education, research, and innovation that are likely to have beneficial, neutral, or negative effects on overall welfare in the Netherlands. For some options, the effects are unknown. Beneficial education policies are, for instance, policies aimed at increasing teachers' quality and early childhood education programs. Additional R&D tax credits for new firms have favourable effects on innovation. A further increase in the research incentives to universities is expected to raise scientific output.
    Keywords: education; science; innovation; policy
    JEL: I28 O38
    Date: 2006–07
  7. By: William R. Emmons
    Keywords: Consumer protection ; Education - Economic aspects
    Date: 2005
  8. By: Christopher S. Ruebeck; Joseph E. Harrington, Jr.; Robert Moffitt
    Abstract: We examine whether handedness is related to performance in the labor market and, in particular, earnings. We find a significant wage effect for left-handed men with high levels of education. This positive wage effect is strongest among those who have lower than average earnings relative to those of similar high education. This effect is not found among women.
    JEL: J2
    Date: 2006–07
  9. By: Aurora A.C. Teixeira (CEMPRE, Faculdade de Economia do Porto, Universidade do Porto); Natércia Fortuna (CEMPRE, Faculdade de Economia do Porto, Universidade do Porto)
    Abstract: An important characteristic of the role of foreign trade in the technological catch-up of countries is the complementary nature of technological change and human capital formation. In this context, the level of education is likely to have a crucial impact on total factor productivity because it determines the capacity of an economy to carry out technological innovation, and to adopt and to implement efficiently technology from abroad. However, the role of human capital as a pre requisite for technology absorption although theoretically acknowledged has been empirically neglected. One of the main problems with empirical studies in this domain is that they do not clearly test the mechanisms through which trade, namely the import of capital goods, affects total factor productivity or, roughly the level of technological development of a given country. Through cointegration techniques, we demonstrate the relevance of the technological absorption hypothesis. We show that the interaction between human capital and (lagged) machinery imports – that is, the technological absorption capability - is the most critical determinant of Portuguese long-run total factor productivity.
    Keywords: Human capital – Innovation – Trade – Economic growth – Cointegration
    JEL: C22 J24 O30 O40
    Date: 2006–08

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