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Why the Apple Doesn't Fall Far: Understanding Intergenerational Transmission of Human Capital

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  • Sandra E. Black
  • Paul J. Devereux
  • Kjell G. Salvanes

Abstract

Parents with higher education levels have children with higher education levels. However, is this because parental education actually changes the outcomes of children, suggesting an important spillover of education policies, or is it merely that more able individuals who have higher education also have more able children? This paper proposes to answer this question by using a unique dataset from Norway. Using the reform of the education system that was implemented in different municipalities at different times in the 1960s as an instrument for parental education, we find little evidence of a causal relationship between parents’ education and children’s education, despite significant OLS relationships. We find 2SLS estimates that are consistently lower than the OLS estimates with the only statistically significant effect being a positive relationship between mother's education and son's education. These findings suggest that the high correlations between parents’ and children’s education are due primarily to family characteristics and inherited ability and not education spillovers.

(This abstract was borrowed from another version of this item.)

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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 95 (2005)
Issue (Month): 1 (March)
Pages: 437-449

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Handle: RePEc:aea:aecrev:v:95:y:2005:i:1:p:437-449

Note: DOI: 10.1257/0002828053828635
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References

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  1. Bruce Sacerdote, 2000. "The Nature and Nurture of Economic Outcomes," NBER Working Papers 7949, National Bureau of Economic Research, Inc.
  2. Erik Plug, 2004. "Estimating the Effect of Mother's Schooling on Children's Schooling Using a Sample of Adoptees," American Economic Review, American Economic Association, vol. 94(1), pages 358-368, March.
  3. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2003. "Why the apple doesn't fall far: understanding intergenerational transmission of human capital," CeMMAP working papers CWP16/03, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  4. Antonovics, Kate & Goldberger, Arthur S., 2003. "Do Educated Women Make Bad Mothers? Twin Studies of the Intergenerational Transmission of Human Capital," University of California at San Diego, Economics Working Paper Series qt2mk37677, Department of Economics, UC San Diego.
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  7. Aakvik, Arild & Salvanes, Kjell G. & Vaage, Kjell, 2003. "Measuring Heterogeneity in the Returns to Education in Norway Using Educational Reforms," Working Papers in Economics 08/03, University of Bergen, Department of Economics.
  8. Solon, Gary, 1999. "Intergenerational mobility in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 29, pages 1761-1800 Elsevier.
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  21. Daron Acemoglu & Joshua Angrist, 2001. "How Large are Human-Capital Externalities? Evidence from Compulsory-Schooling Laws," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 9-74 National Bureau of Economic Research, Inc.
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  27. Janet Currie & Enrico Moretti, 2003. "Mother'S Education And The Intergenerational Transmission Of Human Capital: Evidence From College Openings," The Quarterly Journal of Economics, MIT Press, vol. 118(4), pages 1495-1532, November.
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  1. Consumer Heterogeneity and Consistent Market Choices
    by Matthew E. Kahn in Environmental and Urban Economics on 2008-02-11 00:04:00
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