nep-edu New Economics Papers
on Education
Issue of 2010‒11‒06
eighteen papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. Estimating Marginal Returns to Education By Carneiro, Pedro; Heckman, James J.; Vytlacil, Edward
  2. Education Impact Study: The Global Recession and the Capacity of Colleges and Universities to Serve Vulnerable Populations in Asia By Gerard Postiglione
  3. The Dog ATE my Economics Homework! Estimates of the Average Effect of Treating Hawaii’s Public High School Students with Economics By Kimberly Burnett; Sumner La Croix
  4. Economic Returns to Schooling for China’s Korean Minority By vinod Mishra; Russell Smyth
  5. Differences by Degree: Evidence of the Net Financial Rates of Return to Undergraduate Study for England and Wales By Walker, Ian; Zhu, Yu
  6. Can Private School Growth Foster Universal Literacy? Panel Evidence from Indian Districts By Pal, Sarmistha; Kingdon, Geeta
  7. Differentiated financing of schools in French-speaking Belgium: prospectives for regulating a school quasi-market By Marc Demeuse; Antoine Derobertmasure; Nathanaël Friant
  8. Can Targeted, Non-Cognitive Skills Programs Improve Achievement? Evidence from EPIS By Martins, Pedro S.
  9. Crime and Education in a Model of Information Transmission By Darwin Cortés; Guido Friebel; Darío Maldonado
  10. Are Specific Skills an Obstacle to Labor Market Adjustment? By Lamo, Ana; Messina, Julián; Wasmer, Etienne
  11. Institutional Change and Academic Patenting: French Universities and the Innovation Act of the 1999 By Antonio Della Malva; Francesco Lissoni; Maria Patrick Llerena
  12. Mentoring, Educational Services, and Incentives to Learn: What Do We Know About Them? By Rodriguez-Planas, Nuria
  13. Optimal Taxation of Education with an Initial Endowment of Human Capital By Christoph Braun
  14. The citation impact of research collaboration in science-based industries: A spatial-institutional analysis By Koen Frenken; Roderik Ponds; Frank van Oort
  15. Slavery, Education, and Inequality By Graziella Bertocchi; Arcangelo Dimico
  16. Pedagogical Innovations for Triggering Social and Economic Entrepreneurship among Youth By Anil. K Gupta
  17. High-School Dropouts and Transitory Labor Market Shocks: The Case of the Spanish Housing Boom By Ainhoa Aparicio
  18. Estimating the Returns to Firm-Sponsored on-the-Job and Classroom Training By Benoit Dostie

  1. By: Carneiro, Pedro (University College London); Heckman, James J. (University of Chicago); Vytlacil, Edward (Yale University)
    Abstract: This paper estimates the marginal returns to college for individuals induced to enroll in college by different marginal policy changes. The recent instrumental variables literature seeks to estimate this parameter, but in general it does so only under strong assumptions that are tested and found wanting. We show how to utilize economic theory and local instrumental variables estimators to estimate the effect of marginal policy changes. Our empirical analysis shows that returns are higher for individuals more likely to attend college. We contrast the returns to well-defined marginal policy changes with IV estimates of the return to schooling. Some marginal policy changes inducing students into college produce very low returns.
    Keywords: returns to schooling, marginal return, average return, marginal treatment effect
    JEL: J31
    Date: 2010–10
  2. By: Gerard Postiglione (Asian Development Bank Institute)
    Abstract: This paper reviews the capacity of colleges and universities to serve poor and vulnerable populations during past and present economic shocks. The main argument is that the environment of the global recession—an Asia far more economically integrated than during past economic shocks, with more unified aspirations to be globally competitive and socially responsible—need not delay reforms in higher education. In fact, the global recession is an opportune time for higher education in the Asia and Pacific region to continue reforming governance and administration, access and equity, internal and external efficiency, and regional collaboration. This paper proposes a series of measures to increase the resilience of higher education systems in serving poor and vulnerable populations during the economic recession. These measures include: (i) tuition assistance, subsidies, and loans; (ii) information and guidance for first-generation college students on choosing appropriate programs of study; (iii) community-based vocational and technical higher education that provides jobs in a rapidly changing labor market; (iv) innovative forms of cost sharing between public and private institutions of higher education; (v) resource decisions made on the basis of performance-based objectives; (vi) intensification of philanthropic culture that provides scholarships for poor students; (vii) upgrading of research about problems confronting poor communities; and (viii) regional strategies across the Asia and Pacific region for closer instructional program collaboration among colleges and universities
    Keywords: higher education, economic shocks, reform
    JEL: I2 I20 I21 I22 I23 I28 I29
    Date: 2010
  3. By: Kimberly Burnett (University of Hawaii Economic Research Organization University of Hawaii-Manoa); Sumner La Croix (Department of Economics University of Hawaii-Manoa)
    Abstract: Hawaii is one of 27 states that do not require testing of public high school students regarding their understanding of economics. We report results for the first economics test administered to a large sample of students in Hawaii public high schools during the Spring 2004 semester. Our analysis focuses on evaluating the impact of a semester-long course in economics on student scores on a 20-question, multiple-choice economics test. We specify and estimate a regression analysis of exam scores that controls for other factors that could influence student performance on the exam. While student scores on the economics exam are relatively low, completion of an economics course and participation in a stock market simulation game each add about one point to student scores.
    Keywords: economic education, high school economics, stock market simulation
    JEL: A20 A21 I21
    Date: 2010–01
  4. By: vinod Mishra; Russell Smyth
    Abstract: This paper examines economic returns to schooling for China’s Korean minority in the urban labour market using ordinary least squares (OLS) and two-stage least squares. The OLS estimates of the returns to schooling are similar to findings from recent studies for the Chinese urban labour market. We use father’s education, mother’s education and spouse’s education to instrument for education. The two-stage least squares estimates are considerably higher than the OLS estimates for returns to schooling and slightly higher than existing two-stage least squares estimates of the returns to schooling for the Chinese urban labour market. The two stage least squares estimates of the returns to schooling for the Korean minority living in urban areas are high compared with the Asian average and world average. The economic returns to schooling reported in this study assists to explain why private demand for education among the Korean minority in China is strong and provides a justification for the Korean minority’s focus on educational attainment.
    Date: 2010–05
  5. By: Walker, Ian (Lancaster University); Zhu, Yu (University of Kent)
    Abstract: This paper provides estimates of the impact of higher education qualifications on the earnings of graduates in the UK by subject studied. We use data from the recent UK Labour Force Surveys which provide a sufficiently large sample to consider the effects of the subject studied, class of first degree, and postgraduate qualifications. Ordinary Least Squares estimates show high average returns for women that does not differ by subject. For men, we find very large returns for Law, Economics and Management but not for other subjects. Quantile Regression estimates suggest negative returns for some subjects at the bottom of the distribution, or even at the median in Other Social Sciences, Arts and Humanities for men. Degree class has large effects in all subjects suggesting the possibility of large returns to effort. Postgraduate study has large effects, independently of first degree class. A large rise in tuition fees across all subjects has only a modest impact on relative rates of return suggesting that little substitution across subjects would occur. The strong message that comes out of this research is that even a large rise in tuition fees makes little difference to the quality of the investment – those subjects that offer high returns (LEM for men, and all subjects for women) continue to do so. And those subjects that do not (especially OSSAH for men) will continue to offer poor returns. The effect of fee rises is dwarfed by existing cross subject differences in returns.
    Keywords: college premium, rate of return
    JEL: I23 I28
    Date: 2010–10
  6. By: Pal, Sarmistha (Brunel University); Kingdon, Geeta (Institute of Education, University of London)
    Abstract: Millennium Development Goals (MDGs) set the agenda for the attainment of universal literacy by 2015 primarily to be delivered by the state sector. This agenda tends to ignore the significant private school growth around the world since early 1990s, thus initiating the policy debate as to whether private school growth may foster 'education for all'. Despite growing literature on the difficulties of attaining MDGs, there is hardly any attempt to assess the role of private sector in this respect. Using India as an important case in point, we intend to bridge this gap of the literature. Results using a unique district-level panel data-set from 17 major states of India for the period 1992-2002 that we compile highlight a significant positive impact of private school growth on literacy while its effect on gender gap in literacy remains rather limited in our sample. Compared to 15-19 year olds, private school effect of literacy is stronger among 10-14 year old children. Interesting variations across the regions and also among the marginalised ethnic groups are noted. The paper offers explanations for the findings.
    Keywords: private school growth, universal literacy, gender gap, Millennium Development Goals, India, Asia
    JEL: I21 I28 O15
    Date: 2010–10
  7. By: Marc Demeuse (INAS - Institut d'Administration scolaire - Université de Mons); Antoine Derobertmasure (INAS - Institut d'Administration scolaire - Université de Mons); Nathanaël Friant (INAS - Institut d'Administration scolaire - Université de Mons)
    Abstract: The school quasi-market in French-speaking Belgium is characterised by segregation of various types. Efforts to apply measures that encourage greater social mixing have met with stiff resistance and various difficulties. In 2008 and 2009, a significant amount of turbulence was caused by the application of the "social mixing" law influencing the registration procedures for students in secondary education. The purpose of this article is to present some results from a prospective research project that investigated the possibility of modifying the formula for financing schools, the foundation of the quasi-market mechanism. To do this, a generalised formula for allocating funds to schools according to need is proposed on the basis of legislation currently in force in the French Community of Belgium. Then, the solution tested is presented with a financing formula that takes into account indicators of the social composition of the school population. Various scenarios of differentiated financing of schools according to these indicators are presented, through simulations using real data on the effects of these scenarios in terms of gains and losses first for all schools, and then for different contrasting schools thereafter. Finally, the implications of these scenarios are discussed and put into perspective with respect to the different solutions considered since 2005 in French-speaking Belgium.
    Keywords: Prospective; social mixing; regulation; education
    Date: 2010–05–01
  8. By: Martins, Pedro S. (Queen Mary, University of London)
    Abstract: EPIS is an original and large private-sector program aimed at improving student achievement and eroding early school leaving at Portuguese state schools. The program first screens students to focus only on those more likely to perform poorly; and then conducts a number of small-group sessions aimed at improving the non-cognitive skills (e.g. study skills, motivation, self-esteem) of the selected students. Our quasi-experimental evidence of the effects of EPIS is drawn from rich longitudinal student data and the different timings in the roll-out of the program, both within and across schools. The results indicate that the program reduced grade retention by at least 10 percentage points and did so in a cost effective way.
    Keywords: student achievement, program evaluation, matched school-student data
    JEL: I20 J08
    Date: 2010–10
  9. By: Darwin Cortés (Universidad del Rosario); Guido Friebel (Goethe-Universität); Darío Maldonado (Universidad del Rosario)
    Abstract: We model the decisions of young individuals to stay in school or drop-out and engage in criminal activities. We build on the literature on human capital and crime engagement and use the framework of Banerjee (1993) that assumes that the information needed to engage in crime arrives in the form of a rumor and that individuals update their beliefs about the profitability of crime relative to education. These assumptions allow us to study the effect of social interactions on crime. We first show that a society with fully rational students is less vulnerable to crime than an otherwise identical society with boundedly rational students. We also investigate the spillovers from the actions of talented students to less talented students and show that policies that decrease the cost of education for talented students may increase the vulnerability of less talented students to crime. This is always the case when the heterogeneity of students with respect to talent is sufficiently small.
    Keywords: Human Capital, The Economics of Rumors, Social Interactions, Urban Economics
    JEL: D82 D83 I28
    Date: 2010–10
  10. By: Lamo, Ana (European Central Bank); Messina, Julián (World Bank); Wasmer, Etienne (Sciences Po, Paris)
    Abstract: This paper shows that specialized education reduces workers' mobility and hence their ability to cope with economic changes. We illustrate this point using labor force data from two countries having experienced important macroeconomic turbulence; a large economy with rigid labor markets, Poland, and a small open economy with increased flexibility, Estonia. We find that holding a vocational degree is associated with much longer unemployment duration spells and higher likelihood of leaving activity for older workers. We then build a theoretical framework in which young agents' careers are heavily determined by the type of initial education, and analyze the transition to a new steady-state after a sectoral demand shift. Quantitative exercises suggest that the over-specialization of the labor force in Poland led to much higher and persistent unemployment compared to Estonia during the period of EU enlargement. Traditional labor market institutions (wage rigidity and employment protection) lead to an increase of the unemployment gap, but to a lesser extent.
    Keywords: transition countries, vocational education, specific skills, EU enlargement
    JEL: J4 J24
    Date: 2010–10
  11. By: Antonio Della Malva (Maastricht University (The Netherlands)); Francesco Lissoni (DIMI-Università di Brescia and KITES-Universitá Bocconi, Milan (Italy)); Maria Patrick Llerena (BETA, Universitè de Strasbourg (France))
    Abstract: The Innovation Act was introduced by the French government in 1999, with the aim of encouraging academic institutions to protect and commercialize their scientists’ inventions. We explore the effects of the Act on the distribution of Intellectual Property Rights (IPRs) over academic scientists’ inventions. We find that before the Act, academic institutions had a strong tendency to leave such IPRs in the hands of their main funders, namely public research organizations (such as CNRS or INSERM), and business companies. After the introduction of the Act, French academic institutions have increased their propensity to claim IPRs over their employees’ invention, mainly under the form of co-ownership with business companies. This result vary with the technological class of the patent, the presence and age of a TTO within the university, and the university size and type.
    Keywords: academic inventions, academic research, intellectual property, patents
    JEL: L31 O31 O34
    Date: 2010–01
  12. By: Rodriguez-Planas, Nuria (Universitat Autònoma de Barcelona)
    Abstract: This paper reviews recent studies on the effectiveness of services and incentives offered to disadvantaged youth. We focus our analysis on three types of interventions: mentoring, educational services, and financial rewards. The objective of this article is threefold. First, we explain alternative theoretical points of view in favor (or against – when applicable) each of these interventions. Then, we discuss how recent empirical work has affected that view, and we summarize the latest findings. We conclude with a discussion on what questions remain to be examined. Our hope is that this article will serve as a resource for those seeking to understand what educational interventions work and for whom, and to use as a starting point to illuminate the debate on where to go next.
    Keywords: cognitive and non-cognitive skills, intrinsic and extrinsic motivation, at-risk youth, resilience, deviancy training, deterrence, primary- and high-school, post-secondary education, remedial programs, incentives on inputs and outputs
    JEL: C93 I21 I22 I28 J24
    Date: 2010–10
  13. By: Christoph Braun
    Abstract: Bovenberg and Jacobs (2005) and Richter (2009) derive the education efficiency theorem: In a second-best optimum, the education decision is undistorted if the function expressing the stock of human capital features a constant elasticity with respect to education. I drop this assumption. The household inherits an initial stock of human capital, implying that the aforementioned elasticity is increasing. In a two-period Ramsey model of optimal taxation, I show that the education efficiency theorem does not hold. In a second-best optimum, the discounted marginal social return to education is smaller than the marginal social cost. The household overinvests in human capital relative to the first best. The government effectively subsidizes the return to education.
    Keywords: Optimal taxation, human capital
    JEL: H21 I28 J24
    Date: 2010–10
  14. By: Koen Frenken; Roderik Ponds; Frank van Oort
    Abstract: This study shows for eight science-based industries that the citation impact of research collaboration is higher for international collaboration than for national and regional collaboration. A further analysis of institutional affiliations shows that university-industry-government collaborations profit from being organised at the regional scale only in the cases of biotechnology and organic fine chemistry. The alleged importance of physical proximity for successful interaction between university, industry and government thus is not robust across industries. We discuss the policy implications that follow.
    Keywords: proximity, citation, globalisation, university-industry-government collaboration, triple helixience, economics of science, geography of science, sociology of scientific knowledge
    JEL: O30 R10
    Date: 2010–03
  15. By: Graziella Bertocchi (University of Modena, CEPR, CHILD e IZA); Arcangelo Dimico (University of Nottingham)
    Abstract: We investigate the impact of slavery on the current performances of the US economy. Over a cross section of counties, we find that the legacy of slavery does not affect current income per capita, but does affect current income inequality. In other words, those counties that displayed a higher proportion of slaves are currently not poorer, but more unequal. Moreover, we find that the impact of slavery on current income inequality is determined by racial inequality. We test three alternative channels of transmission between slavery and inequality: a land inequality theory, a racial discrimination theory and a human capital theory. We find support for the third theory, i. e., even after controlling for potential endogeneity, current inequality is primarily influenced by slavery through the unequal educational attainment of blacks and whites. To improve our understanding of the dynamics of racial inequality along the educational dimension, we complete our investigation by analyzing a panel dataset covering the 1940-2000 period at the state level. Consistently with our previous findings, we find that the educational racial gap significantly depends on the initial gap, which was indeed larger in the former slave states.
    Keywords: Slavery, development, inequality, institutions, education
    JEL: D02 H52 J15 O11
    Date: 2010–01
  16. By: Anil. K Gupta
    Abstract: Recent economic meltdown triggered worldwide search for viable options for generating employment through entrepreneurial opportunities for the youth. Not many countries succeeded although India has fared much better. In this paper the author discuss the challenges faced by India soon after meltdown and the strategies that could work. While many ideas have still potential to influence the pedagogy and the content of educational programmes in the short term, some have value for longer term entrepreneurial revolution. [W.P. No. 2010-10-02]
    Keywords: economic, entrepreneurial, ideas, potential
    Date: 2010
  17. By: Ainhoa Aparicio
    Abstract: This paper addresses the implications of transitory changes in labor market conditions for low versus high educated workers on the decision to acquire education. To identify this effect, I use the improvement in the labor market prospects of low educated workers motivated by the increases in employment and wages in the construction sector during the recent housing boom. The estimation strategy is based on the fact that changes in the labor market driven by the construction sector affect only men. Increases in construction activity are found to increase men's propensity to drop out of high-school, relative to women. According to this finding, policies promoting education should strengthen when in the presence of transitory shocks in the labor market that make dropping out more attractive.
    Keywords: High-school dropout; housing boom; Spain
    JEL: J24 J22 I20 L74
    Date: 2010
  18. By: Benoit Dostie
    Abstract: In this paper, we estimate returns to classroom and on-the-job firm sponsored training in terms of value-added per worker using longitudinal linked employee-employer Canadian data from 1999 to 2006. We estimate a standard production function controlling for endogenous training decisions because of perceived net benefits and time-varying market conditions using dynamic panel GMM methods. We find that employees who undertook classroom training are 11 percent more productive than otherwise similar employees. We show that returns to on-the-job training are on average lower (3:4 percent). We provide evidence that these lower returns are due to on-the-job training being more closely related to turnover and more geared toward subjects that are less productivity-enhancing. <P>Nous estimons dans cet article les rendements de la formation parrainée par l'employeur, en classe et en cours d'emploi, en termes de valeur ajoutée par travailleur en utilisant les données de l'Enquête sur le milieu de travail et les employés (EMTE) de Statistique Canada pour la période 1999-2006. Nous estimons une fonction de production où nous tenons compte de l'endogénéité des décisions de formation des entreprises due aux bénéfices escomptés et aux conditions de marché en utilisant une version dynamique de la méthode des moments généralisés. Nous trouvons que les employés ayant reçu de la formation en classe sont 11 % plus productif. Par contre, nous trouvons que les rendements de la formation en cours d'emploi sont inférieurs (3,4 %). Nous montrons que ces rendements inférieurs sont expliqués par le fait que la formation en cours d'emploi est reliée plus étroitement au roulement de la main d'oeuvre et que les sujets qui y sont traités ont moins d'impacts sur la productivité.
    Keywords: Productivity, On-the-job training, Classroom training, Turnover, Linked employer-employee data, Productivité, formation en cours d'emploi, formation en classe, roulement de la main-d'oeuvre, données employeur-employé liées
    Date: 2010–10–01

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