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Present Bias and Underinvestment in Education? Long-Run Effects of Childhood Exposure to Booms in Colombia

Author

Listed:
  • Bladimir Carrillo

Abstract

This paper examines the long-run impacts of income shocks by exploiting variation in coffee cultivation patterns within Colombia and world coffee prices during cohorts’ school-going years. The results indicate that cohorts that faced higher returns to coffee-related work in childhood completed fewer years of schooling and have lower adult earnings scores. Several pieces of evidence suggest that these results reflect changes in educational decisions induced by temporary changes in the opportunity cost of schooling. These findings are consistent with the possibility that students may ignore or heavily discount the future consequences of dropout decisions when faced with immediate income gains.

Suggested Citation

  • Bladimir Carrillo, 2020. "Present Bias and Underinvestment in Education? Long-Run Effects of Childhood Exposure to Booms in Colombia," Journal of Labor Economics, University of Chicago Press, vol. 38(4), pages 1127-1265.
    • Handle: RePEc:ucp:jlabec:doi:10.1086/706535
    DOI: 10.1086/706535
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    Cited by:

    1. Johan Hombert & Adrien Matray, 2019. "Technology Boom, Labor Reallocation, and Human Capital Depreciation," Working Papers 260, Princeton University, Department of Economics, Center for Economic Policy Studies..
    2. Sigurdsson,Jósef & Jósef Sigurdsson, 2025. "Transitory Earnings Opportunities and Educational Scarring of Men," CESifo Working Paper Series 11807, CESifo.
    3. Patrick Bennett, 2021. "The Work-To-School Transition: Job Displacement and Skill Upgrading among Young High School Dropouts," CESifo Working Paper Series 9417, CESifo.
    4. Hern√°n Carvajal, 2023. "Efectos de la suspensi√≥n de las aspersiones a√©reas con glifosato sobre la deserci√≥n escolar en Colombia," Documentos CEDE 20307, Universidad de los Andes, Facultad de Economía, CEDE.
    5. He, Zeyi & Hu, Zhi-An & Huang, Wei & Kang, Yankun, 2025. "Tourism growth, education decline: Evidence from China’s 5A attraction expansion," Journal of Urban Economics, Elsevier, vol. 150(C).
    6. Naomi Gershoni & Rania Gihleb & Assaf Kott & Hani Mansour & Yannay Shanan, 2025. "Adjustments to Reduced Cash Transfers: Religious Safety Nets and Children's Long-Term Outcomes," CESifo Working Paper Series 11856, CESifo.
    7. Thiago Scarelli & David N. Margolis, 2025. "When You Can’t Afford to Wait for a Job: The Role of Time Discounting for Own-Account Workers in Developing Countries," Economic Development and Cultural Change, University of Chicago Press, vol. 73(4), pages 1605-1657.
    8. Andrew L. Dabalen & Justice Tei Mensah & Nsabimana,Aimable, 2024. "Local Economic Shocks and Human Capital Accumulation : Evidence from Rwandan Coffee Mills," Policy Research Working Paper Series 10993, The World Bank.
    9. Bourassa-Viau, Simon & Garon, Jean-Denis & Haeck, Catherine, 2022. "Educational choices and labour market outcomes in times of crisis," Economics of Education Review, Elsevier, vol. 88(C).
    10. John A. List & Ragan Petrie & Anya Samek, 2023. "How Experiments with Children Inform Economics," Journal of Economic Literature, American Economic Association, vol. 61(2), pages 504-564, June.
    11. Habtamu Ali Beshir & Jean-François Maystadt, 2024. "Price Shocks and Human Capital: Timing Matters," Economic Development and Cultural Change, University of Chicago Press, vol. 72(4), pages 1567-1583.
    12. Maurizio Malpede, 2020. "The Dark Side of Batteries: Education, Fertility and Cobalt Mining in the Democratic Republic of Congo," GREEN Working Papers 08, GREEN, Centre for Research on Geography, Resources, Environment, Energy & Networks, Universita' Bocconi, Milano, Italy.
    13. Andrew L. Dabalen & Justice Tei Mensah & Nsabimana,Aimable & Nshunguyinka,Alexandre, 2025. "Agricultural Windfalls and Electrification," Policy Research Working Paper Series 11019, The World Bank.
    14. repec:ags:aaea22:335460 is not listed on IDEAS
    15. Maurizio Malpede, 2022. "The Dark Side of Batteries: Child Labor and Cobalt Mining in the Democratic Republic of the Congo," GREEN Working Papers 22, GREEN, Centre for Research on Geography, Resources, Environment, Energy & Networks, Universita' Bocconi, Milano, Italy.
    16. Xu, Huayu, 2021. "The long-term health and economic consequences of improved property rights," Journal of Public Economics, Elsevier, vol. 201(C).
    17. Boone, Christopher & Kaila, Heidi & Sahn, David E., 2024. "Posh Spice or Scary Spice? Resource Booms, Wealth, and Human Capital across Ages," IZA Discussion Papers 17085, IZA Network @ LISER.
    18. Diaz Gutierrez, Julian, 2023. "Trade Effects on Substance Abuse: Evidence from Colombia's Liberalization," 2023 Annual Meeting, July 23-25, Washington D.C. 335460, Agricultural and Applied Economics Association.
    19. Kebede,Hundanol Atnafu, 2021. "The Pass-Through of International Commodity Price Shocks to Producers’ Welfare : Evidence from EthiopianCoffee Farmers," Policy Research Working Paper Series 9839, The World Bank.

    More about this item

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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