Does Compulsory School Attendance Affect Schooling and Earnings?

51 Pages Posted: 14 Aug 2007 Last revised: 20 Aug 2009

See all articles by Joshua D. Angrist

Joshua D. Angrist

Massachusetts Institute of Technology (MIT) - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Alan B. Krueger

Princeton University - Industrial Relations Section; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Date Written: December 1990

Abstract

This paper presents evidence showing that individuals' season of birth is related to their educational attainment because of the combined effects of school start age policy and compulsory school attendance laws. In most school districts, individuals born in the beginning of the year start school at a slightly older age, and therefore are eligible to drop out of school after completing fewer years of schooling than individuals born near the end of the year. Our estimates suggest that as many as 25 percent of potential dropouts remain in school because of compulsory schooling laws. We estimate the impact of compulsory schooling on earnings by using quarter of birth as an instrumental variable for education in an earnings equation. This provides a valid identification strategy because date of birth is unlikely to be correlated with omitted earnings determinants. The instrumental variables estimate of the rate of return to education is remarkably close to the ordinary least squares estimate, suggesting that there is little ability bias in conventional estimates of the return to education. The results also imply that individuals who are compelled to attend school longer than they desire by compulsory schooling laws reap a substantial return for their extra schooling.

Suggested Citation

Angrist, Joshua and Krueger, Alan B., Does Compulsory School Attendance Affect Schooling and Earnings? (December 1990). NBER Working Paper No. w3572. Available at SSRN: https://ssrn.com/abstract=1006503

Joshua Angrist (Contact Author)

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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IZA Institute of Labor Economics

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Alan B. Krueger

Princeton University - Industrial Relations Section ( email )

Princeton, NJ 08544-2098
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609-258-2907 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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