The Causal Effect of Parents' Schooling on Children's Schooling - A Comparison of Estimation Methods

49 Pages Posted: 9 Nov 2010

See all articles by Helena Holmlund

Helena Holmlund

IFAU - Institute for Labour Market Policy Evaluation

Mikael Lindahl

University of Bonn; IZA Institute of Labor Economics

Erik Plug

University of Amsterdam - Amsterdam School of Economics (ASE); Tinbergen Institute; IZA Institute of Labor Economics

Date Written: November 8, 2010

Abstract

We review the empirical literature that estimates the causal effect of parent’s schooling on child’s schooling, and conclude that estimates differ across studies. We then consider three explanations for why this is: (a) idiosyncratic differences in data sets; (b) differences in remaining biases between different identification strategies; and (c) differences across identification strategies in their ability to make out-of-sample predictions. We conclude that discrepancies in past studies can be explained by violations of identifying assumptions. Our reading of past evidence, together with an application to Swedish register data, suggests that intergenerational schooling associations are largely driven by selection. Parental schooling constitutes a large part of the parental nurture effect, but as a whole does not play a large role.

Keywords: intergenerational mobility, education, causation, selection, identification

JEL Classification: C13, I21, J62

Suggested Citation

Holmlund, Helena and Lindahl, Mikael and Plug, Erik, The Causal Effect of Parents' Schooling on Children's Schooling - A Comparison of Estimation Methods (November 8, 2010). CESifo Working Paper Series No. 3234. Available at SSRN: https://ssrn.com/abstract=1705112

Helena Holmlund

IFAU - Institute for Labour Market Policy Evaluation ( email )

Box 513
751 20 Uppsala
Sweden

Mikael Lindahl (Contact Author)

University of Bonn ( email )

Postfach 2220
Bonn, D-53012
Germany

IZA Institute of Labor Economics

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

Erik Plug

University of Amsterdam - Amsterdam School of Economics (ASE) ( email )

Roetersstraat 11
1018 WB Amsterdam
Netherlands
+31 20 5254311 (Phone)
+31 20 5254310 (Fax)

Tinbergen Institute

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

IZA Institute of Labor Economics

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

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