Education and Wealth Accumulation: Evidence from Sweden

63 Pages Posted: 23 Aug 2019 Last revised: 3 Oct 2019

See all articles by Anastasia Girshina

Anastasia Girshina

Swedish House of Finance at Stockholm School of Economics

Date Written: March 1, 2019


This paper studies the relationship between education and wealth accumulation over the life cycle. The analysis relies on an administrative panel that reports educational attainment, financial assets, real estate property, and debt, as well as career-long income histories of Swedish residents. To address selection bias and identify the causal effect of education, I control for parental background and ability and use within-siblings variation in educational attainment as two alternative identification strategies. I find that education has a positive and economically large effect on both financial and real estate wealth, and that this effect is compensated only partly by the differences in debt levels. I further show that education affects wealth accumulation not only through its direct effect on labor income, but also through differences in consumption-savings and investment decisions. The results are robust to the alternative identification strategy exploiting the reform of compulsory schooling as a source of exogenous variation in educational attainment. The findings suggest that considering only income returns to education greatly understates its economic benefits.

Keywords: household finance, education, wealth accumulation

JEL Classification: D10, D31, G11

Suggested Citation

Girshina, Anastasia, Education and Wealth Accumulation: Evidence from Sweden (March 1, 2019). Swedish House of Finance Research Paper No. 19-10. Available at SSRN: or

Anastasia Girshina (Contact Author)

Swedish House of Finance at Stockholm School of Economics ( email )

Drottninggatan 98
111 60 Stockholm

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