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Childhood Economic Resources, Academic Performance and the Choice to Leave School at Age Sixteen

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  • Sholeh A. Maani

    () (Department of Economics, The University of Auckland)

  • Guyonne Kalb

    () (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

Abstract

This paper uses a recent panel data set from New Zealand to examine the link between academic performance and the decision of teenagers to leave school. These choices have significant lifetime economic impacts, since early school leaving in many cases closes pathways to further education. We address the potential endogeneity and error correlation of academic performance and later school-leaving choices. The results show that schooling decisions largely represent personal choice, and that they are influenced by factors that are at work for a long period of time. Personal ability, parental education and income during early and later childhood years influence the demand for education, exerting their influence directly and through academic performance. These results point to the role that academic performance could play in breaking cycles of disadvantage.

Suggested Citation

  • Sholeh A. Maani & Guyonne Kalb, 2003. "Childhood Economic Resources, Academic Performance and the Choice to Leave School at Age Sixteen," Melbourne Institute Working Paper Series wp2003n01, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  • Handle: RePEc:iae:iaewps:wp2003n01
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    File URL: http://melbourneinstitute.unimelb.edu.au/downloads/working_paper_series/wp2003n01.pdf
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    References listed on IDEAS

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    1. David M. Blau, 1999. "The Effect Of Income On Child Development," The Review of Economics and Statistics, MIT Press, pages 261-276.
    2. Borland, Jeff & Wilkins, Roger, 1996. "Earnings Inequality in Australia," The Economic Record, The Economic Society of Australia, vol. 72(216), pages 7-23, March.
    3. Paul Gregg & Stephen Machin, 2000. "Child Development and Success or Failure in the Youth Labor Market," NBER Chapters,in: Youth Employment and Joblessness in Advanced Countries, pages 247-288 National Bureau of Economic Research, Inc.
    4. Robert Haveman & Barbara Wolfe, 1995. "The Determinants of Children's Attainments: A Review of Methods and Findings," Journal of Economic Literature, American Economic Association, pages 1829-1878.
    5. Feinstein, Leon & Symons, James, 1999. "Attainment in Secondary School," Oxford Economic Papers, Oxford University Press, vol. 51(2), pages 300-321, April.
    6. Case, A.C. & Katz, L.F., 1991. "The Company You Keep: The Effects Of Family And Neighborhood On Disadvantaged Younths," Harvard Institute of Economic Research Working Papers 1555, Harvard - Institute of Economic Research.
    7. Borjas, George J, 1995. "Ethnicity, Neighborhoods, and Human-Capital Externalities," American Economic Review, American Economic Association, pages 365-390.
    8. Borjas, George J, 1995. "Ethnicity, Neighborhoods, and Human-Capital Externalities," American Economic Review, American Economic Association, pages 365-390.
    9. Case, A.C. & Katz, L.F., 1991. "The Company You Keep: The Effects Of Family And Neighborhood On Disadvantaged Younths," Harvard Institute of Economic Research Working Papers 1555, Harvard - Institute of Economic Research.
    10. Ermisch, John F & Francesconi, Marco, 1997. "Family Matters," CEPR Discussion Papers 1591, C.E.P.R. Discussion Papers.
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