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Intergenerational Long Term Effects of Preschool - Structural Estimates from a Discrete Dynamic Programming Model

  • Heckman, James
  • Raut, Lakshmi

Using the NLSY79 and the NLSY79 Children and Young Adults datasets, this paper formulates, provides conditions for parametric and non-parametric identification and empirically estimates the parameters of an altruistic model of parental preschool investment within a structural dynamic programming framework. It then examines the effect of a publicly provided preschool policy to disadvantaged children on their educational and labor market achievements, and also on the inter-generational long-term effects on social mobility, college mobility, and earnings inequality. The paper calculates the tax burden of such a social contract policy, taking into account these intra- and inter-generational effects.

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File URL: http://mpra.ub.uni-muenchen.de/20657/1/MPRA_paper_20657.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 20657.

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Date of creation: 27 Jan 2002
Date of revision: 23 Dec 2009
Handle: RePEc:pra:mprapa:20657
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Web page: http://mpra.ub.uni-muenchen.de

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  1. James J. Heckman, 2000. "Policies to Foster Human Capital," JCPR Working Papers 154, Northwestern University/University of Chicago Joint Center for Poverty Research.
  2. Cunha, Flavio & Heckman, James J. & Lochner, Lance, 2006. "Interpreting the Evidence on Life Cycle Skill Formation," Handbook of the Economics of Education, Elsevier.
  3. Janet Currie & Duncan Thomas, 1993. "Does Head Start Make a Difference?," NBER Working Papers 4406, National Bureau of Economic Research, Inc.
  4. Victor Aguirregabiria & Pedro Mira, 1999. "Swapping the Nested Fixed-Point Algorithm: a Class of Estimators for Discrete Markov Decision Models," Computing in Economics and Finance 1999 332, Society for Computational Economics.
  5. Janet Currie, 2001. "Early Childhood Education Programs," Journal of Economic Perspectives, American Economic Association, vol. 15(2), pages 213-238, Spring.
  6. Kazuo Nishimura & Lakshmi K. Raut, 2007. "School Choice and the Intergenerational Poverty Trap," Review of Development Economics, Wiley Blackwell, vol. 11(2), pages 412-420, 05.
  7. Hanushek, Eric A, 1986. "The Economics of Schooling: Production and Efficiency in Public Schools," Journal of Economic Literature, American Economic Association, vol. 24(3), pages 1141-77, September.
  8. Rust, John, 1987. "Optimal Replacement of GMC Bus Engines: An Empirical Model of Harold Zurcher," Econometrica, Econometric Society, vol. 55(5), pages 999-1033, September.
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