Attendance, schooling quality, and the demand for education of Mexican Americans, African Americans, and non-Hispanic whites

This study examines the influence of the opportunity costs of school attendance, educational quality attributes, and household socioeconomic status on the educational demand of Mexican Americans, African Americans, and non-Hispanic whites using the 1988–1990 surveys of the National Education Longitudinal Study. Implementing a utility-maximizing framework, educational demand assumes the form of schools' average daily attendance rates and student dropout decisions between the 8th and 10th grades. The basic results suggest that a school's attendance rate is sensitive to educational quality and student characteristics. Moreover, the demand for education measured by student attrition inversely relates to unexplained school attendance, and is positively affected by household socioeconomic status. Some policy recommendations based on the results are discussed.     

Subject choice and earnings of UK graduates

Using a survey of a cohort of UK graduates, linked to administrative data on higher education participation, this paper investigates the labour market attainment of recent graduates by subject of study. We document a large heterogeneity in the mean wages of graduates from different subjects and a considerably larger one within subject with individuals with the most favourable unobserved characteristics obtaining wages almost twice as large as those with the worst. Moreover, gender differences in wages within subjects are also large. We then simulate a graduate tax to calculate a willingness to pay – in form of tuition fees – to capture these subject wage premia.     

Economics of education: A research agenda

The paper presents a systematic taxonomy of research areas in the economics of education and gives a number of key topics that deserve more research attention in the future. Emphasis is put on documenting the unit cost of education at different schooling levels and curriculum types, along with the learning and earning outcomes of education. Evidence on the costs and benefits, from both the private and the social point of view, can lead to efficiency and equity assessments of an educational system. Among topics where the research effort should be intensified are the screening hypothesis, measuring education externalities and the quality of schooling.     

Private education in a poor country: The case of urban Bolivia

Investment in education is critical for economic growth and poverty alleviation. Such investment is typically being financed by the state. Yet in many countries families contribute privately to the education of their children. In an era of stagnating public budgets for education (and practically anything else), the private financing of education gains importance for a country's investment in human resources to be maintained. It is often claimed that private education is highly selective and afforded only by the rich. In this paper we examine the extent of private expenditure on education in a country that is among the poorest—Bolivia. In the empirical analysis we use data from both the 1990 and 1992 household surveys (Encuesta Intergrada de Hogares). The results show that there is a remarkable willingness of households in Bolivia to pay for private education for their children.     

Norms as a tool of analysis in the economics of education: A contribution of Massy and Zemsky

This paper suggests how Massy and Zemsky's concept of decision-making norms has promise as a tool to support the modeling of economic choices within educational organizations. This concept's practical value would be supported by: analysis of how informational economies are achieved through the delegation of certain relatively routine decisions reflected in norms to administrative personnel; developing criteria for inferring whether observed deviations from decision-making norms are permanent or transitory; and, most important, the development of informationally efficient mechanisms for making norms forward looking in terms of changes in the environment affecting the organization's productivity and financing.     

Economic returns to education: What We Know, What We Don’t Know, and Where We Are Going—Some brief pointers

The estimation of the economic return to education has perhaps been one of the predominant areas of analysis in applied economics for over 50 years. In this short note we consider some of the recent directions taken by the literature, and also some of the blockages faced by both science and policymakers in pushing forward some key issues. This serves by way of introduction to a set of papers for a special issue of the Economics of Education Review.     

Finance, management, and costs of public and private schools in Indonesia

This paper investigates the impact of public vs private finance of education and public vs private management of schools on school cost and efficiency, using school-level data on revenues, expenditures, enrollments, examination scores and student characteristics from Indonesian primary schools. We find that in Indonesia, where schools generally operate at very low funding levels, more money is likely to bring better school quality. Private management is more efficient than public management in achieving academic quality. Private funding also improves efficiency whether the schools are publicly or privately managed, but the incremental effect declines as the local funding share increases.     

The effect of immigrant concentration in schools on native and immigrant children's reading and math skills

Using a unique and very rich PISA dataset from Denmark, we show that the immigrant concentration in the school influences reading and math skills for both immigrant children and native children. Overall, children in schools with a high immigrant concentration score lower on reading and math test scores. The negative effects associated with attending a school with a high immigrant concentration are fairly robust across estimation methods. IV estimates, taking into consideration that parental sorting across neighborhoods might bias the OLS estimates, indicate that immigrant concentration in schools is still important in determining children's math test scores. The estimates are less precise regarding the effect of immigrant concentration on reading test scores. The immigrant concentration in the school has a stronger effect for native children than for immigrant children, but the differences are more pronounced for the math test.     

The impact of college timing on earnings

Adult students, those 25-yrs-old and over, currently constitute 43% of all college students. This paper investigates the importance of the timing of schooling in determining earnings. It is revealed that those who complete college at a later age receive a significantly smaller initial increase in earnings than those who acquire their education earlier in life. This result is important for both personal human capital investment decisions and policy makers.     

Municipal and private sector response to decentralization and school choice

A large number of developing nations are in the process of decentralizing basic education, with the aim of diversifying revenue sources and introducing greater accountability and efficiency. This is especially true in Latin America, where Chile introduced the first significant reform in 1981. This reform kept most of the responsibility for educational finance with the Ministry of Education but transferred the responsibility for delivering services to municipalities and non-profit, private schools. In response to this reform, municipalities increased their finance of public schools, and the supply of subsidized private education increased dramatically. By 1990, enrollment in subsidized private schools represented about one-third of total primary-secondary school enrollments. This paper examines the effects of the reform. Municipal finance, which is closely tied to municipal fiscal capacity, has created inequities in school expenditures even though it represents only 10% of total revenues. Variations in the private school market share across municipalities are principally explained by the ease of market entry, family socioeconomic status, and the relative performance of public and private schools; this model does not offer a satisfactory explanation of the growth in private school enrollments in Chile over time. The effect of the reform on cost-effectiveness is ambiguous. Ministry of Education non-teacher employment declined by over half, while cognitive tests also declined. There is some evidence that the growth in private school enrollments may have improved overall efficiency since private schools are found to be slightly more cost-effective than public schools.     

Does school time matter?—On the impact of compulsory education age on school dropout

A straightforward way to prevent students from leaving education without a higher secondary diploma is increasing the compulsory education age. The idea is that, by staying longer in school, more students eventually obtain a higher secondary diploma. This paper examines the impact of a one-year increase in compulsory school-age on dropping out of secondary education by a difference-in-differences analysis. For this, we exploit a recent compulsory education policy reform in the Netherlands. After controlling for confounding factors and observable covariates, we find that the one year increase in compulsory school-age reduces dropout by 2.5 percentage points. The effect, however, is entirely situated in the group non-liable to the policy reform. We observe that native Dutch vocational students, mostly without retention in grade, but also without a higher secondary diploma at hand, more often left school in the immediate period before the policy reform. Given the economic revival at that time, this may reflect anticipation of labor market opportunities.     

Overeducation in developing economies: How can we test for it, and what does it mean?

A worker is said to be overeducated if he/she has acquired more education than is required to perform his/her job. In the absence of data measuring the number of years of schooling required to perform particular jobs, we propose a new approach to testing for overeducation. Overeducation is confirmed if we observe that education levels rose in jobs that offer very low returns to education and that underwent little technological change. Using labor force surveys from four developing countries, we find evidence of overeducation in unskilled jobs in the Philippines, mild evidence in Mexico, and little evidence in India and Thailand. We show that a job's mean and modal years of schooling are poor proxies for required education. We also show that overeducation sometimes increases within unskilled jobs, even while a growing share of educated workers enter skilled jobs. This may be because the quality of education segments the labor market.     

What determines the return to education: An extra year or a hurdle cleared?

The 1973 Raising of the School Leaving Age from 15 to 16 has been used to identify returns to years’ schooling. However, because the first set of “high stakes” exams are taken in the UK at age 16, the reform affected the proportion with qualifications, as well as schooling length. In order to shed light on whether the returns reflect the extra length of schooling or the increase in qualifications, we exploit another institutional rule – the Easter Leaving Rule – which we argue only affected the probability of obtaining qualifications (and not the length of schooling). We find sizeable returns to academic qualifications – increasing the probability of employment by 40% points – and our results suggest that qualifications drive most of the returns to education.     

Do colleges cultivate critical thinking, problem solving, writing and interpersonal skills?

We investigate how much value college enrollment adds to students’ critical thinking, problem-solving and communication skills, and the role college inputs play in developing these competencies, using data from a 2009 collegiate assessment pilot study in Colombia. Relative to observationally similar first year students, students in their final year of college score about half of a standard deviation higher, with statistically significant higher scores on every individual component of the test. Sensitivity analyses indicate that results are robust to validity threats posed by selection bias. Students in private colleges exhibit significantly higher overall test score differences. Measures of college quality such as selectivity, rankings based on reputation, share of faculty with PhD, share of full-time faculty and expenditures per student, however, are not meaningfully associated with higher test score differences between last and first year students.     

A utility model for teaching load decisions in academic departments

The authors model the class size and teaching load decisions of academic departments in terms of a departmental utility function. Utility is postulated to be asymmetric around class size and teaching load norms, and variables for curricular structure, disciplinary domain, and institutional type are taken into account. Maximization of the utility function produces decision rules for the number of sections to be offered for each course, and hence the faculty's overall teaching load. A nonlinear estimator is developed for the decision rules' parameters and applied to data from four liberal arts colleges and two research universities. Results are consistent with theories about faculty discretionary time and with expectations about the effects of curricular structure on class size. The paper concludes with a discussion about the effects of enrollment uncertainty on faculty load decisions.     

Teacher salaries in Latin America: A review

In this paper we use data from household surveys of 12 Latin American countries to assess how teacher salaries compare to workers in other occupations. The results show great variability from one country to another, ranging from an apparent underpayment of teachers in Bolivia by 35% relative to the control group, and a respective overpayment of 65% in Colombia. However, when statistical controls are introduced for the differential education, hours worked and gender composition between teachers and the comparison group, much of the earnings differential between the two groups disappears. On the basis of this finding, we cannot support the position that teachers are either overpaid or underpaid.     

Frequency of examinations and student achievement in a randomized experiment

We carry out a randomized experiment involving undergraduate students enrolled at an Italian University attending two introductory economics classes to evaluate the impact on achievement of examination frequency and interim feedback provision. Students in the treated group were allowed to undertake an intermediate exam and were informed about the results obtained, while students in the control group could only take the final exam. The results show that students undertaking the intermediate exam perform better both in terms of the probability of passing the exams and of grades obtained. High ability students appear to benefit more from the treatment. The experiment design allows us to disentangle “workload division or commitment” effects from “feedback provision” effects. We find that the estimated treatment impact is due exclusively to the first effect, while the feedback provision has no positive effect on performance. Finally, the better performance of treated students in targeted examinations seems not to be obtained at the expenses of results earned in other examinations.     

Are returns to education on the decline in Venezuela and does Mission Sucre have a role to play?

Anecdotal evidence points to a falling standard of living for the educated in Venezuela. During this same period, President Hugo Chávez implemented several education reforms. We focus on a major university education reform known as Mission Sucre and its potential impact on returns to university education. First, we show that returns to education decreased significantly in Venezuela from 2002 to 2008. Subsequently, we explore the impact of the program on non-program participants and provide evidence that a substantial part of the falling returns at the tertiary level can be linked to Mission Sucre. Our results suggest that the reform created a negative externality on students who did not participate in the program, leading to a 2.7 percentage point decline in returns to university education for non-Mission Sucre students in the 23–28 age cohort.     

The effects of school quality on long-term health

In this paper I estimate the relationship between school quality and mortality. Although many studies have linked the quantity of education to health outcomes, the effect of school quality on health has yet to be examined. I construct synthetic birth cohorts and relate the quality of education they attained to their mortality rates. I find that there is a statistically significant relationship between the mortality–schooling gradients, which depict the return to a year of schooling, and the length of school term and relative teacher wage. For instance, increasing the relative teacher wage by one standard deviation results in about 1.9 less deaths per 1000 people per extra year of education. My results suggest that one way to improve the health of the population is to improve school quality.