Testing the Internal Validity of Compulsory School Reforms as Instrument for Years of Schooling

29 Pages Posted: 23 Aug 2013

See all articles by Giorgio Brunello

Giorgio Brunello

University of Padua - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Institute for the Study of Labor (IZA)

Margherita Fort

University of Bologna; Ifo Institute, CESifo (Center for Economic Studies and Ifo Institute), Ifo Institute; IZA

Guglielmo Weber

University of Padua - Department of Economics; Centre for Economic Policy Research (CEPR); Institute for Fiscal Studies (IFS)

Christoph Weiss

European Union - European Investment Bank

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Abstract

In the large empirical literature that investigates the causal effects of education on outcomes such as health, wages and crime, it is customary to measure education with years of schooling, and to identify these effects using the exogenous variation provided by school reforms increasing compulsory education and minimum school leaving age. If these reforms are correlated to changes in school quality, and school quality is an omitted variable, this identification strategy may fail. We test whether this is the case by using the information provided by two distinct test scores on mathematics and reading and find that we cannot reject the internal validity of this popular identification strategy.

Keywords: human capital, instrumental variables, nested models

JEL Classification: C26, I2

Suggested Citation

Brunello, Giorgio and Fort, Margherita and Weber, Guglielmo and Weiss, Christoph, Testing the Internal Validity of Compulsory School Reforms as Instrument for Years of Schooling. Available at SSRN: https://ssrn.com/abstract=2314828 or http://dx.doi.org/10.2139/ssrn.2314828

Giorgio Brunello (Contact Author)

University of Padua - Department of Economics ( email )

via Del Santo 33
35121 Padova
Italy
+39 049 827 4223 (Phone)
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CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

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Institute for the Study of Labor (IZA)

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Bonn, D-53072
Germany

Margherita Fort

University of Bologna ( email )

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Bologna, 40100
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Ifo Institute, CESifo (Center for Economic Studies and Ifo Institute), Ifo Institute ( email )

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Germany

IZA ( email )

Guglielmo Weber

University of Padua - Department of Economics ( email )

via Del Santo 33
Padova, 35123
Italy
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+39 049 827 4221 (Fax)

Centre for Economic Policy Research (CEPR)

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United Kingdom

Institute for Fiscal Studies (IFS) ( email )

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London, WC1E 7AE
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Christoph Weiss

European Union - European Investment Bank ( email )

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L-2950
Luxembourg

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