nep-edu New Economics Papers
on Education
Issue of 2011‒04‒09
23 papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. School Tracking and Access to Higher Education Among Disadvantaged Groups By Ofer Malamud; Cristian Pop-Eleches
  2. Incentives, resources and the organization of the school system By Facundo Albornoz; Samuel Berlinski; Antonio Cabrales
  3. Public funding of Higher Education: who gains, who loses? By Ana Balcao Reis
  4. Uncovering indicators of effective school management in South Africa using the National School Effectiveness Study By Stephen Taylor
  5. Modelling cognitive skills, ability and school quality to explain labour market earnings differentials By Cobus Burger; Servaas van der Berg
  6. The Impact of Cutting Education Expenditures: The Case of Mexico in the 1980s By Francisco Perez-Arce
  7. Education Signalling and the School-to-work Transition By García-Belenguer, Fernando; Moral Carcedo, Julián
  8. Why do educated mothers matter? A model of parental help By Luciano Canova; Alessandro Vaglio
  9. What are the causes of educational inequalities and of their evolution over time in Europe? Evidence from Pisa By Veruska Oppedisano; Gilberto Turati
  10. Kaderschmieden der Wirtschaft und/oder Universitäten? Der Auftrag der Wirtschaftsuniversitäten und -fakultäten im 21. Jahrhundert By Kirchgässner, Gebhard
  11. Student Status and Academic Performance: Accounting for the Symptom of Long Duration of Studies in Greece By Elias Katsikas; Theodore Panagiotidis
  12. Universities and regional economic growth in Spanish regions By Néstor Duch-Brown; Javier García-Estévez; Martí Parellada-Sabata
  13. With a Little Help from My (Random) Friends: Success and Failure in Post-Business School Entrepreneurship By Josh Lerner; Ulrike Malmendier
  14. Is A Dream Deferred a Dream Denied?: College Enrollment and Labor Market Search By Francisco Perez-Arce
  15. The Effect of Education on Time Preferences By Francisco Perez-Arce
  16. Understanding Social Interactions: Evidence from the Classroom By Giacomo De Giorgi; Michele Pellizzari
  17. Evaluating students’ evaluations of professors By Michela Braga; Marco Paccagnella; Michele Pellizzari
  18. Should vocational education be taxed? Lessons from a matching model with generalists and specialists By Ophélie Cerdan; Bruno Decreuse
  19. The Completion Behaviour of Registered Apprentices: Who Continues, Who Quits, and Who Completes Programs? By Laporte, Christine; Mueller, Richard
  20. Shaping the formation of university-industry research collaborations: what type of proximity does really matter? By Pablo D'Este; Frederick Guy; Simona Iammarino
  21. Do universities affect firms’ location decisions? Evidence from Spain By Néstor Duch-Brown; Javier García-Estévez
  22. Evidence of Competition in Research Activity among Economic Department using Spatial Econometric Techniques By J. Paul Elhorst; Katarina Zigova
  23. Assessment at the centre of strategies of [accountant] learning in groups, substantiated with qualitative reflections in student assessments By Dixon, Keith

  1. By: Ofer Malamud; Cristian Pop-Eleches
    Abstract: When students are tracked into vocational and academic secondary schools, access to higher education is usually restricted to those who completed an academic track. Postponing such tracking may increase university attendance among disadvantaged students if additional time in school enables them to catch up with their more privileged counterparts. However, if ability and expectations are fairly well set by an early age, postponing tracking during adolescence may not have much effect. This paper exploits an educational reform in Romania to examine the impact of postponing tracking on the proportion of disadvantaged students graduating from university using a regression discontinuity (RD) design. We show that, although students from poor, rural areas and with less educated parents were significantly more likely to finish an academic track and become eligible to apply for university after the reform, this did not translate into an increase in university completion. Our findings indicate that simply postponing tracking, without increasing the slots available in university, is not sufficient to improve access to higher education for disadvantaged groups.
    JEL: I21
    Date: 2011–03
  2. By: Facundo Albornoz; Samuel Berlinski; Antonio Cabrales
    Abstract: We study a model where student effort and talent interact with parental and teachers' investments, as well as with school system resources. The model is rich, yet sufficiently stylized to provide novel implications. We can show, for example, that an improvement in parental outside options will reduce parental and school effort, which are partially compensated through school resources. In this way we provide a rationale for the ambiguous existing empirical evidence on the effect of school resources. We also provide a novel microfoundation for peer effects, with empirical implications on welfare and on preferences for sorting across schools.
    Keywords: Education, Incentives, School resources, Parental involvement, School sorting, Peer effects
    JEL: I20 I21 I28 J24
    Date: 2011–03
  3. By: Ana Balcao Reis
    Abstract: This paper analyses the efects of public funding of higher education on the welfare of the diferent agents. It takes into account the hierarchical nature of the educational system and also the fact that parents always have the possibility to complement basic public education with private expenditures in individual tutoring. It is obtained that although public funding implies a larger access to higher education it is always the case that some of the agents that gain access lose in welfare terms. Moreover, it is shown that the marginal agent to access university would always prefer a pure private funding system. Thus, when studying the e¤ects of public funding of higher education, we can not identify gaining access to University with an increase in welfare. Finally, I consider a funding system where only those that send their o¤spring to university support the funding of higher education.
    Keywords: higher education, public funding; higher education, public funding. JEL codes: I22, I28
    Date: 2011
  4. By: Stephen Taylor (Department of Economics, University of Stellenbosch)
    Abstract: For many poor South African children, who are predominantly located in the historically disadvantaged part of the school system, the ongoing low quality of education acts as a poverty trap by precluding them from achieving the level of educational outcomes necessary to be competitive in the labour market. An important question is the extent to which this low quality of education is attributable to poverty itself as opposed to other features of teaching and management that characterise these schools. The literature explaining schooling outcomes in South Africa has reached a consensus that additional educational resources are no guarantee of improved outcomes. While socio-economic status remains the most powerful determinant of educational outcomes, studies have typically struggled to isolate other school and teacher characteristics that consistently predict outcomes, leaving much of the variation in achievement unexplained. Several authors have pointed to an ineffable mix of management efficiency and teacher quality that must surely underlie this unexplained component. The National School Effectiveness Study (NSES) is the first large-scale panel study of educational achievement in South African primary schools. It examines contextually appropriate features of school management and teacher practice more thoroughly than other large sample surveys previously administered in South Africa. Using the NSES data, this paper identifies specific aspects of school organisation and teacher practice, such as the effective coverage of curriculum and completed exercises, which are associated with literacy and numeracy achievement and with the amount of learning that occurs within a year of schooling. Some suggestions are also made regarding the appropriate way to interpret these results for the purpose of policy-making.
    Keywords: National School Effectiveness Study (NSES), South Africa, education, education production function, school management, economics of education
    JEL: I20 I21 I30 O15
    Date: 2011
  5. By: Cobus Burger (Department of Economics, University of Stellenbosch); Servaas van der Berg (Department of Economics, University of Stellenbosch)
    Abstract: Attempts to explain wage differences between race groups in South Africa are constrained by the fact that quality of education is known to differ greatly between groups, thus the unexplained portion of the wage gap may be much affected by such differences in education quality. Using a simulation model that utilises school-leaving (matric) examination results and educational attainment levels to generate estimates of education quality, we find that much of the wage gap can indeed be explained by differences in education quality. Thus the unexplained residual, often identified with labour market discrimination, usually greatly over-estimates such discrimination. This emphasises even more strongly the need for greater equity in educational outcomes, particularly in the often unobserved quality of education.
    Keywords: South Africa, education quality, wages, labour market, Oaxaca-Blinder decomposition, discrimination, economics of education
    JEL: J7 J24 J31
    Date: 2011
  6. By: Francisco Perez-Arce
    Abstract: This paper studies the impact of expenditures on the returns to schooling within a context of dramatic reductions in public spending. The author matches data on expenditures and pupil-teacher ratios from Mexico in the 1980s with individual earnings in 2007/2008 and find that the returns to education among individuals that went to poorly funded schools are lower than among those that went to better funded ones. He determines that within-state changes in educational expenditures and pupil-teacher ratios predict changes in the returns to education.
    Date: 2011–03
  7. By: García-Belenguer, Fernando (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.); Moral Carcedo, Julián (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)
    Abstract: This paper studies the relation between labour market institutions and educational systems and how this relation may affect youth unemployment rates. By constructing a signalling model in which education can be used as a signal of workers’ unobserved productivity and firms face firing costs, we investigate how the structure of the educational system and the labour market institutions may influence the school-to-work transition of young unexperienced workers. In particular, we find that different educational systems can lead to different youth unemployment rates, even for high-skilled individuals. Besides, the framework presented in this paper allows to understand how the existence of minimum wages affects individual’s education decision and helps to explain some of the observed empirical regularities.
    Keywords: Educational systems; youth unemployment; minimum wages.
    JEL: J39 J49 J64
    Date: 2011–03
  8. By: Luciano Canova (Enrico Mattei School); Alessandro Vaglio (University of Bergamo)
    Abstract: This paper investigates the role performed by mothers in affecting their childrens’ performance at school. The article develops firstly a theoretical model in which household (parent - child pair) is treated as an individual, whose utility depends both on the performance at school of the student and on consumption. The model focuses on the different possibilities through which help of mothers may affect pupil’s performance both in terms of time devoted to supervision and spillover effects. Empirical evidence then, using PISA 2006 and focusing on Italian case, shows that education of mothers is an issue when interacted with her occupational status. Highly educated mothers have a positive impact on students’ score only when they are highly qualifed in the job market.
    Keywords: Education, PISA, quantile regressions, parental help
    JEL: J12 J24 I21
    Date: 2011
  9. By: Veruska Oppedisano (Marie Curie Research Fellow); Gilberto Turati (University of Torino & HERMES)
    Abstract: This paper provides evidence on the sources of differences in inequalities in educational scores in European Union member states, by decomposing them into their determining factors. Using PISA data from the 2000 and 2006 waves, the paper shows that inequalities emerge in all countries and in both period, but decreased in Germany, whilst they increased in France and Italy. Decomposition shows that educational inequalities do not only reflect background related inequality, but especially schools’ characteristics. The findings allow policy makers to target areas that may make a contribution in reducing educational inequalities. However, they appear to exert a remarkable impact on excess spending.
    Keywords: Education expenditures, educational inequalities, Oaxaca decomposition.
    JEL: I2 I38
    Date: 2011
  10. By: Kirchgässner, Gebhard
    Abstract: After a short sketch of the history of modern business schools in the German speaking countries, their four major activity fields are considered: (i) academic teaching, (ii) scientific research, (iii) consulting and (iv) executive education. While teaching was traditionally dominant, research has gained more importance in recent decades, not only in Economics but also in Management departments. With respect to consulting, we have to distinguish between consulting for governments by economists and for private companies by professors of management. Executive education is mainly a domain of management (and law) departments; economists only play a minor role in this area. We conclude with discussing some of the ethical questions with which Economics and Management departments are confronted today.
    Date: 2011–03
  11. By: Elias Katsikas (Department of Economics, University of Macedonia); Theodore Panagiotidis (Department of Economics, University of Macedonia)
    Abstract: This study employs administrative and survey data to assess the relationship between students’ socioeconomic background and educational outcomes, using regression and quantile regression methods. We take into account the existing institutional framework which allows differentiation in the duration of studies among students. We examine the association of students’ status ? working and non-working ? with degree grades and whether the documented negative influence of long duration of studies on grades is associated to students’ status. The findings reject both hypotheses; working students do not achieve lower grades than their non-working peers; the negative impact of the length of studies on grades is not linked to status, and affects both working and non-working students in the same way.
    Keywords: students, academic performance, duration of studies.
    JEL: I20 I23
    Date: 2011–03
  12. By: Néstor Duch-Brown (University of Barcelona & IEB); Javier García-Estévez (University of Barcelona & IEB); Martí Parellada-Sabata (University of Barcelona & IEB)
    Abstract: This paper examines the main contributions of universities to the economic growth of Spanish regions. It calculates the separate effects of the different university functions on the regional economy, namely the creation of human capital, research and technology transfer. It includes a panel data set with the key variables of university activities and their effects on the economy at provincial level. The econometric estimations are based on information for all 47 public universities and include 34 Spanish provinces. The empirical results suggest that the growth of regional GVA is positively correlated to both the human capital created by universities and the stock of university patents
    Keywords: regional economic development, universities, higher education, human capital, research, technology development
    JEL: R15 I23 O18
    Date: 2011
  13. By: Josh Lerner; Ulrike Malmendier
    Abstract: To what extent do peers affect our occupational choices? This question has been of particular interest in the context of entrepreneurship and policies to create a favorable environment for entry. Such influences, however, are hard to identify empirically. We exploit the assignment of students into business school sections that have varying numbers of classmates with prior entrepreneurial experience. We find that the presence of entrepreneurial peers strongly predicts subsequent entrepreneurship rates of students without an entrepreneurial background, but in a more complex way than the literature has previously suggested: A higher share of entrepreneurial peers leads to lower rather than higher subsequent rates of entrepreneurship. However, the decrease in entrepreneurship is entirely driven by a significant reduction in unsuccessful entrepreneurial ventures. The effect on the rate of successful post-MBA entrepreneurs, instead, is insignificantly positive. In addition, sections with few prior entrepreneurs have a considerably higher variance in their rates of unsuccessful entrepreneurs. The results are consistent with intra-section learning, where the close ties between section-mates lead to insights about the merits of business plans.
    JEL: G24 I23 J24
    Date: 2011–03
  14. By: Francisco Perez-Arce
    Abstract: A public college in Mexico City randomly assigns applicants into a group that can immediately enroll and a group that can only do so after one year. The author shows that the standard model of educational decisions predicts no (or minimal) effect of deferral on educational attainment. He surveyed the applicants to this college for the 2007/2008 academic year. Using data from that survey, he finds that, one and a half years after the first group enrolled, individuals in that group were 19 percentage points more likely to be enrolled than those that had to wait. This implies that offering more slots in a public college increases educational attainment. He finds that one additional slot increases the attainment of at least 0.3 individuals of the applicant pool and that offering them to individuals of poorer backgrounds has an even larger effect. To account for these results, he extends the standard model by placing the education decision in a model of labor market search. This suggests the importance of variability in opportunity costs for explaining who enrolls in college at any given moment. He derives testable implications of the model and show that they are verified empirically. He estimates the parameters of the model and show that the model can explain the observed patterns under reasonable assumptions. He also discusses alternative explanations of the impact of deferral and show they are inconsistent with observed patterns. The conclusion is twofold. First, public supply of college slots can impact the attainment of the target population. Second, within-individual variation in opportunity costs is an important element in determining educational attainment. This latter point can have implications for how systems of higher education systems should be designed.
    Date: 2011–03
  15. By: Francisco Perez-Arce
    Abstract: The author examines whether education increases patience. Admission decisions in a public college in Mexico are determined through a lottery. He finds that applicants who were successful in the draw were more likely to study in the following years. He surveyed the applicants to this college almost two years after the admission decision was made and measured their time preferences with a series of hypothetical inter-temporal choice questions. He finds that individuals who were successful in the admission lottery were, on average, more patient. He argues that this evidence points towards a causal effect of education on time preferences.
    Date: 2011–03
  16. By: Giacomo De Giorgi; Michele Pellizzari
    Abstract: There is a large literature on social interactions and still little is known about the economic mechanisms leading to the high level of clustering in behavior that is so commonly observed in the data. In this paper we present a model in which agents are allowed to interact according to three distinct mechanisms, and we derive testable implications on the mean and the variance of the outcomes within and across groups. The empirical tests allow us to distinguish which mechanism(s) generates the observed patterns in the data. In our application we study the performance of undergraduate students and we find that social interactions take the form of mutual insurance. Such a result bears crucial policy implications for all those situations in which social interactions are important, from teamwork to class formation in education and co-authorship in academic research.
    Date: 2011
  17. By: Michela Braga; Marco Paccagnella; Michele Pellizzari
    Abstract: This paper contrasts measures of teacher effectiveness with the students’ evaluations for the same teachers using administrative data from Bocconi University (Italy). The effectiveness measures are estimated by comparing the subsequent performance in follow-on coursework of students who are randomly assigned to teachers in each of their compulsory courses. We find that, even in a setting where the syllabuses are fixed, teachers still matter substantially. The average difference in subsequent performance between students who were assigned to the best and worst teachers (on the effectiveness scale) is approximately 43% of a standard deviation in the distribution of exam grades, corresponding to about 5.6% of the average grade. Additionally, we find that our measure of teacher effectiveness is negatively correlated with the students’ evaluations of professors: in other words, teachers who are associated with better subsequent performance receive worst evaluations from their students. We rationalize these results with a simple model where teachers can either engage in real teaching or in teaching-to-the-test, the former requiring higher students’ effort than the latter. Teaching-to-the-test guarantees high grades in the current course but does not improve future outcomes. Hence, if students are myopic and evaluate better teachers from which they derive higher utility in a static framework, the model is capable of predicting our empirical finding that good teachers receive bad evaluations, especially when teaching-to-the-test is very effective. Consistently with the predictions of the model, we also find that classes in which high skill students are over-represented produce evaluations that are less at odds with estimated teacher effectiveness.
    Date: 2011
  18. By: Ophélie Cerdan (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579); Bruno Decreuse (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579)
    Abstract: Should education become more vocational or more general? We address this question in two steps. We first build and solve a two-sector matching model with generalists and specialists. Generalists pursue jobs in both sectors; however, they come second in job queues. Specialists seek for jobs in a single sector; they come first in job queues. Self-selection in education type vehicles three main externalities: specialists boost job creation in each sector; generalists improve the efficiency of the matching technology; generalists exacerbate firms' coordination problems. We then calibrate the model on the labor market for upper-secondary graduates in OECD countries. In each country, we match the proportion of specialists and unemployment rates by type of education in 2000. Self-selection is always inefficient: taxing vocational education to reduce the proportion of specialists down to the efficient level could reduce unemployment rates (for upper-secondary graduates) by 1.1 to 1.8 percentage points.
    Keywords: Matching frictions; Education; Efficiency; Calibration
    Date: 2011–03–27
  19. By: Laporte, Christine; Mueller, Richard
    Abstract: The number of registered apprentices in Canada more than doubled between 1995 and 2007, yet successful completion of apprenticeship programs increased by only about one-third as much. Uncovering the factors related to low completion rates is a necessary first step to ensuring that today's skilled labour is replaced in the future. This study utilizes the 2007 National Apprenticeship Survey (NAS) to investigate the completion behaviour of individuals enrolled in apprenticeship programs. These behaviours include continuing, discontinuing (or quitting), and completing programs. The NAS contains detailed demographic information regarding respondents' backgrounds and the characteristics of apprenticeship programs. The results show that program completion is positively related to a variety of demographic characteristics, including being married and having completed at least a high school education prior to beginning an apprenticeship. Males and females have similar completion probabilities. Completion is negatively related to time in the apprenticeship program (beyond the normal program length) and the number of employers during training. Type of technical training and having a journeyperson always present enhance the probability of completion. The regional unemployment rate has little effect on whether an individual completes an apprenticeship program or not. There are also large provincial and trade group differences. This is a revised version of an earlier paper circulated under the same title (Laporte and Mueller 2010). We thank the Canadian Labour Market and Skills Researcher Network (CLSRN) and Human Resources and Skills Development Canada (HRSDC) for supporting this research. We would also like to thank an anonymous reviewer, Grant Schellenberg, and Pamela White for useful comments as well as participants at the January 2010 HRSDC-CLSRN Apprenticeship Workshop in Vancouver and many colleagues at Statistics Canada and HRSDC.
    Keywords: Education, training and learning, Fields of study, Educational attainment, Outcomes of education
    Date: 2011–03–28
  20. By: Pablo D'Este; Frederick Guy; Simona Iammarino
    Abstract: Research collaborations between universities and industry (U-I) are considered to be one important channel of potential localised knowledge spillovers. These collaborations favour both intended and unintended flows of knowledge and facilitate learning processes between partners from different organisations. Despite the copious literature on localised knowledge spillovers, still little is known about the factors driving the formation of U-I research collaborations and, in particular, about the role that geographical proximity plays in the establishment of such relationships. Using collaborative research grants between universities and business firms awarded by the UK Engineering and Physical Sciences Research Council (EPSRC), in this paper we disentangle some of the conditions under which different kinds of proximity contribute to the formation of U-I research collaborations, focussing in particular on technological complementarity among the firms participating in such partnerships.
    Keywords: university-industry research collaborations, proximity, geography, industrial clustering, technological complementarity
    JEL: O31 O32 O33 R10
    Date: 2011–03
  21. By: Néstor Duch-Brown (University of Barcelona & IEB); Javier García-Estévez (University of Barcelona & IEB)
    Abstract: Human capital, scientific research, and technology are the three chief mechanisms promoting knowledge spillovers from universities to firms. Based on a study of the impact of Spain’s 1983 University Reform Act (LRU), which opened the door to the foundation of new universities and faculties, this paper examines whether university (or faculty) location affects the creation of new firms within a given province. We conclude that the foundation of science and social science faculties has had a marked impact on the creation of firms.
    Keywords: universities, firm location, spillovers, poisson regression
    JEL: I23 O31 R12 R39 C23
    Date: 2011
  22. By: J. Paul Elhorst (Faculty of Economics and Business, University of Groningen, The Netherlands); Katarina Zigova (Department of Economics, University of Konstanz, Germany)
    Abstract: Despite the prevalence of both competitive forces and patterns of collaboration within academic communities, studies on research productivity generally treat universities as independent entities. By exploring the research productivity of all academic economists employed at 81 universities and 17 economic research institutes in Austria, Germany, and German-speaking Switzerland, this study determines whether a research unit’s productivity depends on that of neighboring research units. The significant negative relationship that is found implies competition for priority of discovery among individual researchers, as well as the universities and research institutes that employ them. In addition, the empirical results support the hypotheses that collaboration and the existence of economies of scale increase research productivity.
    Keywords: Research productivity, Competition, Collaboration, Negative spatial autocorrelation, Geo-referenced point data
    JEL: C21 D85 I23 J24 R12
    Date: 2011–03–29
  23. By: Dixon, Keith
    Abstract: Having students learn and be assessed in groups is a means to develop among students intellectual and interactive skills/competencies described as generic or “wicked”, as well as of producing deeper learning of various types of knowledge (e.g. organicistic, contextualistic, formistic, mechanistic). This paper reports assessments constituting and reflecting strategies of learning in groups. The assessments and the strategies were crafted while working with students on four courses presented annually in recent years and covering accounting, management and finance for public services and private activities in various organisations. Data about group experiences and their implications for working as accountants were collected from students during assessments and are used to elaborate the strategies. The paper provides insights into reducing impediments among students and teachers to shifting learning from teacher-centred to learner-centred, and suggests areas for further research in reducing institutional impediments.
    Keywords: Student engagement; generic skills/competencies; group assessment; group learning
    JEL: M1 H83 M4
    Date: 2011–03

This nep-edu issue is ©2011 by Joao Carlos Correia Leitao. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.