In a Small Moment: Class Size and Moral Hazard in the Mezzogiorno

57 Pages Posted: 6 Apr 2015

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

Erich Battistin

Institute for Fiscal Studies (IFS)

Daniela Vuri

University of Rome Tor Vergata; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

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Abstract

An instrumental variables (IV) identification strategy that exploits statutory class size caps shows significant achievement gains in smaller classes in Italian primary schools. Gains from small classes are driven mainly by schools in Southern Italy, suggesting a substantial return to class size reductions for residents of the Mezzogiorno. In addition to high unemployment and other social problems, however, the Mezzogiorno is distinguished by pervasive manipulation of standardized test scores, a finding revealed in a natural experiment that randomly assigns school monitors. IV estimates also show that small classes increase score manipulation. Dishonest scoring appears to be a consequence of teacher shirking in grade transcription, rather than cheating by either students or teachers. Estimates of a causal model for achievement with two endogenous variables, class size and score manipulation, suggest that the effects of class size on measured achievement are driven entirely by the relationship between class size and manipulation. These findings show how consequential score manipulation can arise even in assessment systems with few NCLB-style accountability concerns.

Keywords: test scores, education production, regression discontinuity

JEL Classification: C26, C31, I21, I28, J24

Suggested Citation

Angrist, Joshua and Battistin, Erich and Vuri, Daniela, In a Small Moment: Class Size and Moral Hazard in the Mezzogiorno. IZA Discussion Paper No. 8959. Available at SSRN: https://ssrn.com/abstract=2589821

Joshua Angrist (Contact Author)

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Erich Battistin

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Daniela Vuri

University of Rome Tor Vergata ( email )

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IZA Institute of Labor Economics

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Germany

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