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Parents’ income and children’s school drop-out at 16 in England and Wales: evidence from the 1970 British Cohort Study

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  • Massimiliano Bratti

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Abstract

This paper investigates the effect of parents’ income on children’s drop-out from school at age 16 using data from the 1970 British Cohort Study (BCS70). Unlike previous papers using the same data set, we use a continuous measure of income derived from the grouped income variable available in the BCS70, we employ instrumental variable techniques to address the issue of endogeneity of family income and take account of the potential endogeneity of income response with respect to a child’s education by jointly modelling the school drop-out decision and response to the family income question. Our estimates show the exogeneity of response to the income question with a child’s education and are in line with the previous literature finding a statistically significant small negative effect of family income on school drop-out at 16. On the contrary, other non-pecuniary parental effects, such as parental education and social class, turn out to be both significant and of a sizeable magnitude. Copyright Springer Science+Business Media, LLC 2007

Suggested Citation

  • Massimiliano Bratti, 2007. "Parents’ income and children’s school drop-out at 16 in England and Wales: evidence from the 1970 British Cohort Study," Review of Economics of the Household, Springer, vol. 5(1), pages 15-40, March.
  • Handle: RePEc:kap:reveho:v:5:y:2007:i:1:p:15-40
    DOI: 10.1007/s11150-007-9001-6
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    1. repec:eee:joepsy:v:62:y:2017:i:c:p:98-119 is not listed on IDEAS
    2. Regina Riphahn & Florian Schieferdecker, 2012. "The transition to tertiary education and parental background over time," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(2), pages 635-675, January.
    3. Migali, G,; & Zucchelli, E,;, 2015. "The Relationship between Forgone Health Care and High School Dropout: Evidence from US Adolescents," Health, Econometrics and Data Group (HEDG) Working Papers 15/01, HEDG, c/o Department of Economics, University of York.
    4. Rossella Iraci Capuccinello & Steve Bradley, 2014. "The effect of college mergers on student dropout behaviour," Working Papers 64907218, Lancaster University Management School, Economics Department.
    5. Steven Bradley & Giuseppe Migali, 2017. "The Effects of the 2006 Tuition Fee Reform and the Great Recession on University Student Dropout Behaviour in the UK," Working Papers 149346773, Lancaster University Management School, Economics Department.
    6. Rossella Iraci Capuccinello, 2014. "Determinants and timing of dropping out decisions: evidence from the UK FE sector," Working Papers 15742191, Lancaster University Management School, Economics Department.
    7. Giuseppe Migali & Eugenio Zucchelli, 2014. "The relationship between forgone health care and high school dropout," Working Papers 71679142, Lancaster University Management School, Economics Department.
    8. Steve Bradley & Giuseppe Migali, 2015. "The Effect of a Tuition Fee Reform on the Risk of Drop Out from University in the UK," Working Papers 86010138, Lancaster University Management School, Economics Department.

    More about this item

    Keywords

    BCS70; Children; Education; Family income; School drop-out; I20; J24;

    JEL classification:

    • 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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