Is the Quarter of Birth Endogenous? New Evidence from Taiwan, the US, and Indonesia

38 Pages Posted: 5 Nov 2017

See all articles by Elliott Fan

Elliott Fan

National Taiwan University

Jin‐Tan Liu

National Taiwan University - Department of Economics; National Bureau of Economic Research (NBER)

Yen‐Chien Chen

National Chi Nan University

Date Written: December 2017

Abstract

Recent evidence based on US data suggests that the quarter or month of birth (QOB or MOB) may be endogenous, since family characteristics can explain up to 50% of the effects of QOB on the education outcomes and earnings of adult males. In this study, based on a sample of one million Taiwanese siblings, we examine university admission at age 18 as our outcome variable and find that at school entry, the oldest (September born) children are 31–38% more likely to be admitted into university at age 18 than the youngest (August born) children, indicating strong seasonality in university admission. The inclusion of controls for family background is found to explain only a small portion of these effects, particularly for males. Given that such results are at odds with the recent US evidence, we revisit the US Census data and find that when racial differences are properly controlled for in the estimation, even a rich set of family characteristics is capable of explaining only a minor proportion of the QOB effects. Furthermore, using data from the US and Indonesia, we find that seasonal temperature variation is unlikely to be an important contributor to the US‐Taiwan disparity. Our findings imply that the validity of using QOB or MOB as an instrumental variable may be dependent on the population being studied and the sample selected.

Suggested Citation

Fan, Elliott and Liu, Jin-Tan and Chen, Yen‐Chien, Is the Quarter of Birth Endogenous? New Evidence from Taiwan, the US, and Indonesia (December 2017). Oxford Bulletin of Economics and Statistics, Vol. 79, Issue 6, pp. 1087-1124, 2017, Available at SSRN: https://ssrn.com/abstract=3064383 or http://dx.doi.org/10.1111/obes.12175

Elliott Fan

National Taiwan University ( email )

1 Sec. 4, Roosevelt Road
Taipei 106, 106
Taiwan

Jin-Tan Liu (Contact Author)

National Taiwan University - Department of Economics ( email )

21 Hsu-Chow Road
Taipei, 10020
Taiwan

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Yen‐Chien Chen

National Chi Nan University ( email )

Taiwan
China

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