A Large Scale Experiment : Wages and Educational Expansion in France
We evaluate the wage impact of the strong and rapid increase in schoolinglevels experienced by the cohorts born after WWII in France. In order toidentify the causal effect of education, we exploit the fact that the smallgroup of people graduating from elite education (Grandes Ecoles) remainedstable, while the rest of the system experienced tremendous transformation.This provides a well defined control group. Using large scale labor forcesurveys for the 1990's, we find that the cohorts that received more educationhave a lower wage gap, relative to Grandes Ecoles. We show that such alarge scale experiment measures a social return to schooling even in thepresence of signaling, whereas strategies based on quasi-experiments are notnecessarily robust to signaling. Our instrumental variable estimation findsreturns to schooling very similar to the rest of the literature, which is a strongcase against the signaling hypothesis.
|Date of creation:||2007|
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