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The Effect of a Social Experiment in Education

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  • Meghir, Costas

    (University College London)

  • Palme, Marten

    (Dept. of Economic Statistics, Stockholm School of Economics)

Abstract

The impact of compulsory schooling laws as well as the abolition of early selection by ability remain important issues in the educational debate. These issues were the focus of a major education reform in Sweden which was implemented in the 60s. The reform was preceded by a ``social experiment'' in which only a proportion of municipalities received the new school system. We use survey data linked with tax records covering 10\%\ of one of the cohorts who were educated during the experimental period, to evaluate the impact of the reform on educational attainment and earnings. We find significant increases in the educational attainment of individuals from poorer backgrounds. We also find that the largest impact on earnings was for higher ability individuals from poorer backgrounds. In addition we estimate the returns to education for those affected by the reform. By exploiting the differential impact of the reform by county we are able, in some cases, to distinguish its direct effect on earnings from the effect it had by increasing the quantity of education. We find that the main source of increased earnings came from increasing educational attainment.

Suggested Citation

  • Meghir, Costas & Palme, Marten, 2001. "The Effect of a Social Experiment in Education," SSE/EFI Working Paper Series in Economics and Finance 0451, Stockholm School of Economics.
    • Handle: RePEc:hhs:hastef:0451
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    References listed on IDEAS

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    1. Joshua D. Angrist & Alan B. Krueger, 1991. "Estimating the Payoff to Schooling Using the Vietnam-era Draft Lottery," Working Papers 670, Princeton University, Department of Economics, Industrial Relations Section..
    2. David Card, 1994. "Earnings, Schooling, and Ability Revisited," Working Papers 710, Princeton University, Department of Economics, Industrial Relations Section..
    3. Kristin F. Butcher & Anne Case, 1994. "The Effect of Sibling Sex Composition on Women's Education and Earnings," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(3), pages 531-563.
    4. David Card, 1994. "Earnings, Schooling, and Ability Revisited," Working Papers 710, Princeton University, Department of Economics, Industrial Relations Section..
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    Cited by:

    1. Flavio Cunha & James J. Heckman, 2009. "Human Capital Formation in Childhood and Adolescence," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 7(4), pages 22-28, 01.
    2. James Heckman & Flavio Cunha, 2007. "The Technology of Skill Formation," American Economic Review, American Economic Association, vol. 97(2), pages 31-47, May.
    3. Flavio Cunha & James J. Heckman, 2009. "The Economics and Psychology of Inequality and Human DEvelopment," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 320-364, 04-05.
    4. Belzil, Christian & Hansen, Jorgen, 2007. "A structural analysis of the correlated random coefficient wage regression model," Journal of Econometrics, Elsevier, vol. 140(2), pages 827-848, October.
    5. Christian Belzil, 2008. "Testing the Specification of the Mincer Wage Equation," Annals of Economics and Statistics, GENES, issue 91-92, pages 427-451.
    6. Randi Hjalmarsson & Helena Holmlund & Matthew J. Lindquist, 2015. "The Effect of Education on Criminal Convictions and Incarceration: Causal Evidence from Micro‐data," Economic Journal, Royal Economic Society, vol. 125(587), pages 1290-1326, September.
    7. Dinand Webbink, 2004. "Returns to university education; evidence from an institutional reform," CPB Discussion Paper 34, CPB Netherlands Bureau for Economic Policy Analysis.
    8. Andersson, Fredrik & Konrad, Kai A., 2002. "Taxation and education investment in the tertiary sector [Besteuerung und Bildungsinvestitionen im tertiären Sektor]," Discussion Papers, Research Unit: Market Processes and Governance FS IV 02-17, WZB Berlin Social Science Center.
    9. James J. Heckman, 2008. "Schools, Skills, And Synapses," Economic Inquiry, Western Economic Association International, vol. 46(3), pages 289-324, July.
    10. Arendt, Jacob Nielsen, 2005. "Does education cause better health? A panel data analysis using school reforms for identification," Economics of Education Review, Elsevier, vol. 24(2), pages 149-160, April.
    11. Dinand Webbink, 2004. "Returns to university education; evidence from an institutional reform," CPB Discussion Paper 34.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    12. Raquel Bernal & Adriana Camacho, 2010. "La importancia de los programas para la primera infancia en Colombia," Documentos CEDE 7605, Universidad de los Andes, Facultad de Economía, CEDE.
    13. James J. Heckman, 2007. "The Economics, Technology and Neuroscience of Human Capability Formation," NBER Working Papers 13195, National Bureau of Economic Research, Inc.
    14. Belzil, Christian & Hansen, Jörgen, 2005. "A Structural Analysis of the Correlated Random Coefficient Wage Regression Model with an Application to the OLS-IV Puzzle," IZA Discussion Papers 1585, Institute of Labor Economics (IZA).
    15. Kevin Milligan & Enrico Moretti & Philip Oreopoulos, 2003. "Does Education Improve Citizenship? Evidence from the U.S. and the U.K," NBER Working Papers 9584, National Bureau of Economic Research, Inc.
    16. Vegard Skirbekk & Hans-Peter Kohler & Alexia Fürnkranz-Prskawetz, 2003. "Completing education and the timing of births and marriage: findings from a birth-month experiment in Sweden," MPIDR Working Papers WP-2003-017, Max Planck Institute for Demographic Research, Rostock, Germany.
    17. Belzil, Christian, 2004. "On the Specification of Mincerian Wage Regressions with Heterogeneity, Non-Linearity, Non-Separability, and Heteroskedasticity," IZA Discussion Papers 1083, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Returns to education; LATE; Propesity score matching.;
    All these keywords.

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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