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Class Size, Education and Wages

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Author Info
Dustmann, Christian
Rajah, Najma
van Soest, Arthur

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Abstract

This Paper examines the effects of class size on the decision to stay on in full time schooling at the age of 16 and on wages at later stages in life. Little research exists on the effect of school quality on career decisions, although it has potentially important long-term implications. We use micro data for England and Wales that contain an unusually rich set of variables on parental background and previous achievements. We find that class size, measured as the pupil-teacher ratio at the school level, has a sizeable and significant effect on the decision to remain in full time education beyond the minimum age. This finding is very robust and persists when school type variables, exam results, and results from past ability tests are controlled for. We also estimate wage equations including the staying on decision at age 16 as one of the explanatory variables. The effect of staying on is significantly positive for wages at age 33 and age 42,and for females also at age 23.Combining this effect with the effect of class size on the staying on decision, our results reveal that class size significantly affects future wages. Reduced form models in which wages are directly regressed on class size lead to much less accurate and generally insignificant estimates.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 3397.

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Date of creation: May 2002
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Handle: RePEc:cpr:ceprdp:3397

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Related research
Keywords: educational attainment school inputs training

Other versions of this item:

Find related papers by JEL classification:
C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models
I20 - Health, Education, and Welfare - - Education - - - General
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  3. Pradhan, Menno & van Soest, Arthur, 1995. "Formal and informal sector employment in urban areas of Bolivia," Labour Economics, Elsevier, vol. 2(3), pages 275-297, September. [Downloadable!] (restricted)
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    Other versions:
  6. Alan B. Krueger, 2002. "Economic Considerations and Class Size," NBER Working Papers 8875, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  7. Eric A. Hanushek & Steven G. Rivkin & Lori L. Taylor, 1996. "Aggregation and the Estimated Effects of School Resources," NBER Working Papers 5548, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  8. David Card & Alan Krueger, 1996. "Labor Market Effects of School Quality: Theory and Evidence," Working Papers 736, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
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  9. David Card & Thomas Lemieux, 2000. "Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis," NBER Working Papers 7655, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Gary-Bobo, Robert J. & Mahjoub, Mohamed Badrane, 2006. "Estimation of Class-Size Effects, Using 'Maimonides' Rule': The Case of French Junior High Schools," CEPR Discussion Papers 5754, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  2. Sarah Brown & John Sessions & Karl Taylor, 2004. "What Will I Be When I Grow Up? An Analysis of Childhood Expectations and Career Outcomes," Discussion Papers in Economics 05/2, Department of Economics, University of Leicester. [Downloadable!]
  3. Christopher C. Klein, 2007. "Efficiency versus Effectiveness: Interpreting Education Production Studies," Working Papers 200703, Middle Tennessee State University, Department of Economics and Finance. [Downloadable!]
  4. Kaoru Nabeshima, 2003. "Raising the quality of secondary education in East Asia," Policy Research Working Paper Series 3140, The World Bank. [Downloadable!]
  5. Sarah Brown & Karl Taylor, 2005. "Bullying, Education and Labour Market Outcomes: Evidence from the National Child Development Study," Working Papers 2005015, The University of Sheffield, Department of Economics, revised Aug 2005. [Downloadable!]
  6. Torbjørn Hægeland, Oddbjørn Raaum and Kjell G. Salvanes, 2004. "Pupil achievement, school resources and family backgr," Discussion Papers 397, Research Department of Statistics Norway. [Downloadable!]
  7. Petra E. Todd & Kenneth I. Wolpin, 2003. "On The Specification and Estimation of The Production Function for Cognitive Achievement," Economic Journal, Royal Economic Society, vol. 113(485), pages F3-F33, February. [Downloadable!] (restricted)
  8. Raaum, Oddbjørn & Salvanes, Kjell G. & Sørensen, Erik Ø., 2003. "The Impact of a Primary School Reform on Educational Stratification: A Norwegian Study of Neighbour and School Mate Correlations," IZA Discussion Papers 953, Institute for the Study of Labor (IZA). [Downloadable!]
  9. Graddy, Kathryn & Stevens, Margaret, 2003. "The Impact of School Inputs on Student Performance: An Empirical Study of Private Schools in the UK," CEPR Discussion Papers 3776, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  10. Hægeland, Torbjørn & Raaum, Oddbjørn & Salvanes, Kjell G., 2005. "Pupil Achievement, School Resources and Family Background," IZA Discussion Papers 1459, Institute for the Study of Labor (IZA). [Downloadable!]
  11. James J. Heckman & Dimitriy V. Masterov, 2005. "Allander Series: Skill Policies for Scotland," NBER Working Papers 11032, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  12. Martin Browning & Eskil Heinesen, 2003. "Class size, teacher hours and educational attainment," CAM Working Papers 2003-15, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics, revised Jun 2005. [Downloadable!]
    Other versions:
  13. Kathryn Graddy & Margaret Stevens, 2003. "The Impact of School Inputs on Student Performance: An Empirical Study of Private Schools in the United Kingdom," Economics Series Working Papers 146, University of Oxford, Department of Economics. [Downloadable!]
  14. Heckman, James J. & Masterov, Dimitriy V., 2004. "Skill Policies for Scotland," IZA Discussion Papers 1444, Institute for the Study of Labor (IZA). [Downloadable!]
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  15. Sarah Brown & Karl Taylor, 2003. "Religion and Education: Evidence from the National Child Development Study," Discussion Papers in Economics 03/16, Department of Economics, University of Leicester. [Downloadable!]
    Other versions:
  16. Yamauchi, Futoshi, 2004. "Race, equity, and public schools in post-apartheid South Africa," FCND discussion papers 182, International Food Policy Research Institute (IFPRI). [Downloadable!]
    Other versions:
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