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Does Money Buy Higher Schooling?: Evidence from Secondary School Track Choice in Germany

  • Marcus Tamm

The German schooling system selects children into different secondary school tracks already at a very early stage in life. School track choice heavily influences choices and opportunities later in life. It has often been observed that secondary schooling achievements display a strong correlation with parental income. We use sibling fixed effects models and information on a natural experiment in order to analyze whether this correlation is due to a causal effect of income or due to unobservable factors that themselves might be correlated across generations. Our main findings suggest that income has no positive causal effect on school choice and that differences between high- and low-income households are driven by unobserved heterogeneity, e.g. differences in motivation or preferences.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.63400.de/diw_sp0041.pdf
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Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 41.

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Length: 19 p.
Date of creation: 2007
Date of revision:
Handle: RePEc:diw:diwsop:diw_sp41
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  1. Gary S. Becker & Nigel Tomes, . "Human Capital and the Rise and Fall of Families," University of Chicago - Population Research Center 84-10, Chicago - Population Research Center.
  2. Sylke Schnepf, 2002. "A Sorting Hat that Fails? The transition from primary to secondary school in Germany," Papers inwopa02/22, Innocenti Working Papers.
  3. repec:ese:iserwp:2005-22 is not listed on IDEAS
  4. Marco Francesconi & Stephen Jenkins & Thomas Siedler, 2010. "Childhood family structure and schooling outcomes: evidence for Germany," Journal of Population Economics, Springer, vol. 23(3), pages 1073-1103, June.
  5. Thorsten Schneider, 2004. "Der Einfluss des Einkommens der Eltern auf die Schulwahl," Discussion Papers of DIW Berlin 446, DIW Berlin, German Institute for Economic Research.
  6. Bauer, Thomas K. & Gang, Ira N., 2000. "Sibling Rivalry in Educational Attainment: The German Case," IZA Discussion Papers 180, Institute for the Study of Labor (IZA).
  7. Cunha, Flavio & Heckman, James J. & Lochner, Lance John & Masterov, Dimitriy V., 2005. "Interpreting the Evidence on Life Cycle Skill Formation," IZA Discussion Papers 1675, Institute for the Study of Labor (IZA).
  8. Corak, Miles & Fertig, Michael & Tamm, Marcus, 2005. "A Portrait of Child Poverty in Germany," IZA Discussion Papers 1528, Institute for the Study of Labor (IZA).
  9. Becker, Gary S & Tomes, Nigel, 1979. "An Equilibrium Theory of the Distribution of Income and Intergenerational Mobility," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1153-89, December.
  10. Eric I. Knudsen & James J. Heckman & Judy L. Cameron & Jack P. Shonkoff, 2006. "Economic, Neurobiological and Behavioral Perspectives on Building America's Future Workforce," NBER Working Papers 12298, National Bureau of Economic Research, Inc.
  11. Robert Haveman & Barbara Wolfe, 1995. "The Determinants of Children's Attainments: A Review of Methods and Findings," Journal of Economic Literature, American Economic Association, vol. 33(4), pages 1829-1878, December.
  12. Jenkins, Stephen P. & Schluter, Christian, 2002. "The Effect of Family Income During Childhood on Later-Life Attainment: Evidence from Germany," IZA Discussion Papers 604, Institute for the Study of Labor (IZA).
  13. Christian Dustmann, 2004. "Parental background, secondary school track choice, and wages," Oxford Economic Papers, Oxford University Press, vol. 56(2), pages 209-230, April.
  14. Richard Williams, 2006. "Generalized ordered logit/partial proportional odds models for ordinal dependent variables," Stata Journal, StataCorp LP, vol. 6(1), pages 58-82, March.
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