Returns to Schooling in Spain. How Reliable Are IV Estimates?
AbstractThis paper studies the Ordinary Least-Squared (OLS) and Instrumental Variables (IV) estimates of the returns to schooling for male workers in Spain. OLS estimates are often biased due to the endogeneity of schooling, measurement errors or omitted variables. Proper IV estimates correct this bias. The reliability of family background, natural experiments (based on changes in the education system and season of birth) and the availability of a college in the province is checked using Spanish data. The results suggest that background and college availability are valid instruments and that the IV estimates of the returns to schooling are higher than OLS estimates. These results are in line with the majority of previous results in the literature.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Queen Mary, University of London, School of Economics and Finance in its series Working Papers with number 446.
Date of creation: Nov 2001
Date of revision:
Returns to schooling; Instrumental Variables; Spanish schooling system;
Find related papers by JEL classification:
- C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
- C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
- I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
This paper has been announced in the following NEP Reports:
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.:
- Denny, K.J. & Harmon, C.P., 2000.
"Education Policy Reform and the Return to Schooling from Instrumental Variables,"
00/12, College Dublin, Department of Political Economy-.
- Denny, Kevin & Harmon, Colm, 2000. "Education Policy Reform and the Return to Schooling from Instrumental Variables," CEPR Discussion Papers 2518, C.E.P.R. Discussion Papers.
- Kevin J. Denny & Colm P. Harmon, 2000. "Education Policy Reform and the Return to Schooling from Instrumental Variabes," Econometric Society World Congress 2000 Contributed Papers 1422, Econometric Society.
- Kevin J Denny & Colm P Harmon, 2000. "Education Policy Reform and the Return to Schooling from Instrumental Variables," Working Papers 200012, School Of Economics, University College Dublin.
- Kevin Denny & Colm Harmon, 2000. "Education policy reform and the return to schooling from instrumental variables," IFS Working Papers W00/06, Institute for Fiscal Studies.
- Griliches, Zvi, 1977. "Estimating the Returns to Schooling: Some Econometric Problems," Econometrica, Econometric Society, vol. 45(1), pages 1-22, January.
- Callan, T. & Harmon, C.P., 1997.
"The Economic Return to Schooling in Ireland,"
97/23, College Dublin, Department of Political Economy-.
- Meghir, Costas & Palme, Mårten, 1999.
"Assessing the Effect of Schooling on Earnings Using a Social Experiment,"
Working Paper Series in Economics and Finance
313, Stockholm School of Economics.
- Costas Meghir & Marten Palme, 2000. "Assessing the Effect of Schooling on Earnings Using a Social Experiment," Econometric Society World Congress 2000 Contributed Papers 0670, Econometric Society.
- Costas Meghir & Mårten Palme, 1999. "Assessing the effect of schooling on earnings using a social experiment," IFS Working Papers W99/10, Institute for Fiscal Studies.
- J. A. Hausman, 1976.
"Specification Tests in Econometrics,"
185, Massachusetts Institute of Technology (MIT), Department of Economics.
- Harmon, C & Ian Walker, 1995. "Estimates of the economic return to schooling for the UK," IFS Working Papers W95/12, Institute for Fiscal Studies.
- Jaume Garcia & Pedro J. Hernández & Ángel López Nicolás, 1998.
"How wide is the gap? An investigation of gender wage differences using quantile regression,"
Economics Working Papers
287, Department of Economics and Business, Universitat Pompeu Fabra.
- Angel López-Nicolás & Jaume García & Pedro J. Hernández, 2001. "How wide is the gap? An investigation of gender wage differences using quantile regression," Empirical Economics, Springer, vol. 26(1), pages 149-167.
- Vieira, Jose A. C., 1999. "Returns to education in Portugal," Labour Economics, Elsevier, vol. 6(4), pages 535-541, November.
- Card, David, 2001.
"Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems,"
Econometric Society, vol. 69(5), pages 1127-60, September.
- David Card, 2000. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," NBER Working Papers 7769, National Bureau of Economic Research, Inc.
- David Card, 1994.
"Earnings, Schooling, and Ability Revisited,"
NBER Working Papers
4832, National Bureau of Economic Research, Inc.
- David Card, 1993.
"Using Geographic Variation in College Proximity to Estimate the Return to Schooling,"
NBER Working Papers
4483, National Bureau of Economic Research, Inc.
- David Card, 1993. "Using Geographic Variation in College Proximity to Estimate the Return to Schooling," Working Papers 696, Princeton University, Department of Economics, Industrial Relations Section..
- Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
- Cecilia Albert Verdú, 1998. "- Higher Education Demand In Spain: The Influence Of Labour Market Signals And Family Background," Working Papers. Serie EC 1998-17, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Zamarro, Gema, 2010.
"Accounting for heterogeneous returns in sequential schooling decisions,"
Journal of Econometrics,
Elsevier, vol. 156(2), pages 260-276, June.
- Gema Zamarro, 2006. "Accounting For Heterogeneous Returns In Sequential Schooling Decisions," Working Papers wp2006_0609, CEMFI.
- Zamarro, G., 2006. "Accounting for Heterogeneous Returns in Sequential Schooling Decisions," Discussion Paper 2006-21, Tilburg University, Center for Economic Research.
- Ismail, Ramlee, 2007. "The Impact of Schooling Reform on Returns to Education in Malaysia," MPRA Paper 15021, University Library of Munich, Germany, revised 29 Jan 2008.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Nick Vriend).
If references are entirely missing, you can add them using this form.