Do School Entry Laws Affect Educational Attainment and Labor Market Outcomes?

Abstract

Age based school entry laws force parents and educators to consider an important tradeoff. Though students who enter school early typically have poorer academic performance, on average, they stay in school longer. The popular and academic press has focused primarily on the former effect which has lead to substantial concern and strategic behavior on the part of both parents and educators. In this paper we document that the school entry laws have a very large impact on the age at which students enroll in school and that the youngest students in a class are substantially more likely to be held back a grade. However, we also find that the youngest students in an academic cohort have slightly higher educational attainment than their older peers. To estimate the net effect of this tradeoff we examine a broad range of labor market outcomes and find that early school entry has no effect on any of them. We also document that school entry laws are a poor instrument for educational attainment in wage regressions because they affect wages by numerous causal pathways, several of which have a substantially stronger first stage relationship with the school entry laws than educational attainment does.

Keywords: Education, Returns to Education, School Entry Laws

JEL Classification: I20, J30