IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Quality of schooling, returns to schooling and the 1981 vouchers reform in Chile

  • Patrinos, Harry Anthony

This paper exploits unique information on cognitive ability to examine the importance of schooling and non-schooling cognitive skills for heterogeneous individuals using instrumental variables estimation. Using a binary instrument based on the 1981 reform in Chile, the authors find that the main beneficiaries of the reform were those who at the time were pupils in basic schooling (ages 6-13). For this treated group of pupils, only a negligible part of the estimated return to schooling is due to classical ability bias. The labor market reward to an additional year of schooling is a measure of the"true"non-cognitive return to schooling. However, once the treated group is expanded to include secondary school students, the pure return to schooling decreases dramatically, while the return to schooling cognitive and non-schooling cognitive skills increases accordingly, suggesting that a large part of the estimated return in an earnings function is due to classical ability bias. For this treated group (mixture of basic school and secondary school age students), the labor market rewarded cognitive skills (especially those acquired through schooling) significantly.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www-wds.worldbank.org/servlet/WDSContentServer/WDSP/IB/2008/05/09/000158349_20080509164204/Rendered/PDF/wps4617.pdf
Download Restriction: no

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4617.

as
in new window

Length:
Date of creation: 01 May 2008
Date of revision:
Handle: RePEc:wbk:wbrwps:4617
Contact details of provider: Postal: 1818 H Street, N.W., Washington, DC 20433
Phone: (202) 477-1234
Web page: http://www.worldbank.org/
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Geeta Kingdon & Francis Teal, 2008. "Teacher Unions, Teacher Pay and Student Performance in India: A Pupil Fixed Effects Approach," CESifo Working Paper Series 2428, CESifo Group Munich.
  2. John Bound & Sarah Turner, 2006. "Cohort Crowding: How Resources Affect Collegiate Attainment," NBER Working Papers 12424, National Bureau of Economic Research, Inc.
  3. Francisco Gallego & Andrés E. Hernando, 2008. "On the Determinants and Implications of School Choice: Semi-Structural Simulations for Chile," Documentos de Trabajo 343, Instituto de Economia. Pontificia Universidad Católica de Chile..
  4. Patrinos, Harry Anthony & Sakellariou, Chris, 2004. "Schooling and labor market impacts of a natural policy experiment," Policy Research Working Paper Series 3460, The World Bank.
  5. Francine D. Blau & Lawrence M. Kahn, 1994. "International Differences in Male Wage Inequality: Institutions versus Market Forces," NBER Working Papers 4678, National Bureau of Economic Research, Inc.
  6. David Bravo & Sankar Mukhopadhyay & Petra E. Todd, 2010. "Effects of school reform on education and labor market performance: Evidence from Chile's universal voucher system," Quantitative Economics, Econometric Society, vol. 1(1), pages 47-95, 07.
  7. Green, David A. & Craig Riddell, W., 2003. "Literacy and earnings: an investigation of the interaction of cognitive and unobserved skills in earnings generation," Labour Economics, Elsevier, vol. 10(2), pages 165-184, April.
  8. Joshua D. Angrist & Alan B. Krueger, 1990. "Does Compulsory School Attendance Affect Schooling and Earnings?," NBER Working Papers 3572, National Bureau of Economic Research, Inc.
  9. Sebastián Bustos & Dante Contreras & Paulina Sepulveda, 2007. "When schools are the ones that choose: the effect of screening in Chile," Working Papers wp242, University of Chile, Department of Economics.
  10. Psacharopoulos, George, 1994. "Returns to investment in education: A global update," World Development, Elsevier, vol. 22(9), pages 1325-1343, September.
  11. Chris Sakellariou, 2006. "Education policy reform, local average treatment effect and returns to schooling from instrumental variables in the Philippines," Applied Economics, Taylor & Francis Journals, vol. 38(4), pages 473-481.
  12. repec:dgr:uvatin:20100075 is not listed on IDEAS
  13. Esther Duflo, 2000. "Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment," NBER Working Papers 7860, National Bureau of Economic Research, Inc.
  14. Francisco Gallego, 2002. "Competencia y Resultados Educativos: Teoría y Evidencia para Chile," Documentos de Trabajo 217, Instituto de Economia. Pontificia Universidad Católica de Chile..
  15. Harmon, Colm & Walker, Ian, 2000. "The Returns to the Quantity and Quality of Education: Evidence for Men in England and Wales," Economica, London School of Economics and Political Science, vol. 67(265), pages 19-35, February.
  16. Claudio Sapelli., 2009. "Los Retornos a la Educación en Chile: Estimaciones por Corte Transversal y por Cohortes," Documentos de Trabajo 349, Instituto de Economia. Pontificia Universidad Católica de Chile..
  17. Dan Devroye & Richard B. Freeman, 2002. "Does inequality in skills explain inequality of earnings across advanced countries?," LSE Research Online Documents on Economics 20058, London School of Economics and Political Science, LSE Library.
  18. Costas Meghir & Mårten Palme, 1999. "Assessing the effect of schooling on earnings using a social experiment," IFS Working Papers W99/10, Institute for Fiscal Studies.
  19. Philip Oreopoulos, 2006. "Estimating Average and Local Average Treatment Effects of Education when Compulsory Schooling Laws Really Matter," American Economic Review, American Economic Association, vol. 96(1), pages 152-175, March.
  20. Behrman, Jere R. & Ross, David & Sabot, Richard, 2008. "Improving quality versus increasing the quantity of schooling: Estimates of rates of return from rural Pakistan," Journal of Development Economics, Elsevier, vol. 85(1-2), pages 94-104, February.
  21. George Psacharopoulos & Harry Anthony Patrinos, 2004. "Returns to investment in education: a further update," Education Economics, Taylor & Francis Journals, vol. 12(2), pages 111-134.
  22. Claudio Sapelli & Bernardita Vial, 2002. "The Performance of Private and Public Schools in the Chilean Voucher System," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 39(118), pages 423-454.
  23. Corbo, Vittorio & Stelcner, Morton, 1983. "Earnings determination and labour markets : Gran Santiago, Chile--1978," Journal of Development Economics, Elsevier, vol. 12(1-2), pages 251-266.
  24. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2005. "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools," Journal of Political Economy, University of Chicago Press, vol. 113(1), pages 151-184, February.
  25. Ishikawa, Mamoru & Ryan, Daniel, 2002. "Schooling, basic skills and economic outcomes," Economics of Education Review, Elsevier, vol. 21(3), pages 231-243, June.
  26. Claudio Sapelli, 2003. "The Chilean Voucher System: Some New Results and Research Challenges," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 40(121), pages 530-538.
  27. Edwin Leuven & Hessel Oosterbeek & Hans van Ophem, 2004. "Explaining international differences in male skill wage differentials by differences in demand and supply of skill," Economic Journal, Royal Economic Society, vol. 114(495), pages 466-486, 04.
  28. Hause, John C, 1971. "Ability and Schooling as Determinants of Lifetime Earnings or If You're So Smart, Why Aren't You Rich?," American Economic Review, American Economic Association, vol. 61(2), pages 289-98, May.
  29. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-54, July.
  30. Hsieh, Chang-Tai & Urquiola, Miguel, 2006. "The effects of generalized school choice on achievement and stratification: Evidence from Chile's voucher program," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1477-1503, September.
  31. Card, David, 2001. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," Econometrica, Econometric Society, vol. 69(5), pages 1127-60, September.
  32. Thomas J. Kane & Cecilia E. Rouse, 1993. "Labor Market Returns to Two- and Four-Year Colleges: Is a Credit a Credit and Do Degrees Matter?," NBER Working Papers 4268, National Bureau of Economic Research, Inc.
  33. Francisco A. Gallego, 2004. "School Choice, Incentives, and Academic Outcomes: Evidence from Chile," Econometric Society 2004 Latin American Meetings 39, Econometric Society.
  34. Oscar Landerretche, 2007. "Job flows in chile," Working Papers wp240, University of Chile, Department of Economics.
  35. Riveros, Luis A., 1990. "The economic return to schooling in Chile. An analysis of its long-term fluctuations," Economics of Education Review, Elsevier, vol. 9(2), pages 111-121, June.
  36. Orley Ashenfelter & Cecilia Rouse, 1998. "Income, Schooling, And Ability: Evidence From A New Sample Of Identical Twins," The Quarterly Journal of Economics, MIT Press, vol. 113(1), pages 253-284, February.
  37. Francisco Gallego & Andrés Hernando, 2009. "School Choice in Chile: Looking at the Demand Side," Documentos de Trabajo 356, Instituto de Economia. Pontificia Universidad Católica de Chile..
  38. Hause, John C, 1972. "Earnings Profile: Ability and Schooling," Journal of Political Economy, University of Chicago Press, vol. 80(3), pages S108-S38, Part II, .
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:4617. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.