American Economic Review Vol. 104 No. 6 2014

Compulsory Education and the Benefits of Schooling

Melvin Stephens¹; Dou-Yan Yang²

¹ Department of Economics, University of Michigan, 611 Tappan Street, Ann Arbor, MI 48109, and NBER (e-mail: ) · ² Heinz College, Carnegie Mellon University, 5000 Forbes Avenue, Pittsburgh, PA 15213 (e-mail: )

Abstract

Causal estimates of the benefits of increased schooling using US state schooling laws as instruments typically rely on specifications which assume common trends across states in the factors affecting different birth cohorts. Differential changes across states during this period, such as relative school quality improvements, suggest that this assumption may fail to hold. Across a number of outcomes including wages, unemployment, and divorce, we find that statistically significant causal estimates become insignificant and, in many instances, wrong-signed when allowing year of birth effects to vary across regions.

DOI

10.1257/aer.104.6.1777

Volume

104

Issue

6

Pages

1777-1792

Language

en

Sources

bibtex:phds-export.bib openalex crossref

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