Changes in the Wage Structure, Family Income, and Children's Education

20 Pages Posted: 28 Oct 2000 Last revised: 29 Oct 2022

See all articles by Daron Acemoglu

Daron Acemoglu

Massachusetts Institute of Technology (MIT) - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Jörn-Steffen Pischke

London School of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

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Date Written: October 2000

Abstract

We exploit the changes in the distribution of family income to estimate the effect of parental resources on college education. Our strategy exploits the fact that families at the bottom of the income distribution were much poorer in the 1990s than they were in the 1970s, while the opposite is true for families in the top quartile of the distribution. Our estimates suggest large effects of family income on enrollments. For example, we find that a 10 percent increase in family income is associated with a 1.4 percent increase in the probability of attending a four-year college.

Suggested Citation

Acemoglu, Daron and Pischke, Jörn-Steffen (Steve), Changes in the Wage Structure, Family Income, and Children's Education (October 2000). NBER Working Paper No. w7986, Available at SSRN: https://ssrn.com/abstract=247722

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