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The co-twin methodology and returns to schooling — testing a critical assumption

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  • Sandewall, Örjan
  • Cesarini, David
  • Johannesson, Magnus

Abstract

Twins-based estimates of the return to schooling have featured prominently in the economics of education literature. Their unbiasedness hinges critically on the assumption that within-pair variation in schooling is explained by factors unrelated to wage earning ability. This paper develops a framework for testing this assumption and shows, in a large sample of monozygotic twins, that the twins-based estimated return to schooling falls if adolescent IQ test scores are included in the wage equation. Using birth weight as an alternative proxy for ability yields qualitatively similar results. Our results thus cast doubt on the validity of twins-based estimates.

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Bibliographic Info

Article provided by Elsevier in its journal Labour Economics.

Volume (Year): 26 (2014)
Issue (Month): C ()
Pages: 1-10

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Handle: RePEc:eee:labeco:v:26:y:2014:i:c:p:1-10

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Web page: http://www.elsevier.com/locate/labeco

Related research

Keywords: Returns to schooling; Twins; Equal ability assumption;

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References

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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Twins as an economic model
    by Kevin Denny in Geary Behaviour Centre on 2009-09-02 07:19:00
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Lundborg, Petter & Nilsson, Anton & Rooth, Dan-Olof, 2011. "Does Early Life Health Predict Schooling Within Twin Pairs?," IZA Discussion Papers 5803, Institute for the Study of Labor (IZA).
  2. Lundborg, Petter & Nordin, Martin & Rooth, Dan-Olof, 2011. "The Intergenerational Transmission of Human Capital: Exploring the Role of Skills and Health Using Data on Adoptees and Twins," IZA Discussion Papers 6099, Institute for the Study of Labor (IZA).
  3. Vikesh Amin & Jere R. Behrman, 2011. "Do More-Schooled Women have Fewer Children and Delay Childbearing? Evidence from a Sample of U.S. Twins," PIER Working Paper Archive 11-041, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
  4. Rachel Berner Shalem & Francesca Cornaglia & Jan-Emmanuel De Neve, 2012. "The Enduring Impact of Childhood Experience on Mental Health: Evidence Using Instrumented Co-Twin Data," CEP Discussion Papers dp1175, Centre for Economic Performance, LSE.
  5. Lundborg, Petter & Nordin, Martin & Rooth, Dan Olof, 2012. "The Intergenerational Transmission of Human Capital. The Role of Skills and Health," Working Papers 2012:22, Lund University, Department of Economics.
  6. Gerdtham, Ulf-G & Lundborg, Petter & Lyttkens, Carl Hampus & Nystedt, Paul, 2012. "Do Socioeconomic Factors Really Explain Income-Related Inequalities in Health? Applying a Twin Design to Standard Decomposition Analysis," Working Papers 2012:21, Lund University, Department of Economics.

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