[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp3630.html
   My bibliography  Save this paper

The Causal Effect of Parent's Schooling on Children's Schooling: A Comparison of Estimation Methods

Author

Listed:
  • Holmlund, Helena

    (IFAU)

  • Lindahl, Mikael

    (University of Gothenburg)

  • Plug, Erik

    (University of Amsterdam)

Abstract
Recent studies that aim to estimate the causal link between the education of parents and their children provide evidence that is far from conclusive. This paper explores why. There are a number of possible explanations. One is that these studies rely on different data sources, gathered in different countries at different times. Another one is that these studies use different identification strategies. Three identification strategies that are currently in use rely on: identical twins; adoptees; and instrumental variables. In this paper we apply each of these three strategies to one particular Swedish data set. The purpose is threefold: (i) explain the disparate evidence in the recent literature; (ii) learn more about the quality of each identification procedure; and (iii) get at better perspective about intergenerational effects of education. We find that the three identification strategies all produce intergenerational schooling estimates that are lower than the corresponding OLS estimates, indicating the importance of accounting for ability bias. But interestingly, when applying the three methods to the same data set, we are able to fully replicate the discrepancies across methods found in the previous literature. Our findings therefore indicate that the estimated impact of parental education on that of their child in Sweden does depend on identification, which suggests that country and cohort differences do not lie behind the observed disparities. Finally, we conclude that income is a mechanism linking parent’s and children’s schooling, that can partly explain the diverging results across methods.

Suggested Citation

  • Holmlund, Helena & Lindahl, Mikael & Plug, Erik, 2008. "The Causal Effect of Parent's Schooling on Children's Schooling: A Comparison of Estimation Methods," IZA Discussion Papers 3630, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp3630
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp3630.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Heather Royer, 2009. "Separated at Girth: US Twin Estimates of the Effects of Birth Weight," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 49-85, January.
    2. Anders Björklund & Mikael Lindahl & Erik Plug, 2006. "The Origins of Intergenerational Associations: Lessons from Swedish Adoption Data," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(3), pages 999-1028.
    3. Maurin, Eric & McNally, Sandra, 2005. "Vive la revolution! Long term returns of 1968 to the angry students," LSE Research Online Documents on Economics 3656, London School of Economics and Political Science, LSE Library.
    4. Pedro Carneiro & Costas Meghir & Matthias Parey, 2013. "Maternal Education, Home Environments, And The Development Of Children And Adolescents," Journal of the European Economic Association, European Economic Association, vol. 11, pages 123-160, January.
    5. Philip Oreopoulos & Marianne E. Page, 2006. "The Intergenerational Effects of Compulsory Schooling," Journal of Labor Economics, University of Chicago Press, vol. 24(4), pages 729-760, October.
    6. Jere R. Behrman & Mark R. Rosenzweig, 2002. "Does Increasing Women's Schooling Raise the Schooling of the Next Generation?," American Economic Review, American Economic Association, vol. 92(1), pages 323-334, March.
    7. Bruce Sacerdote, 2002. "The Nature and Nurture of Economic Outcomes," American Economic Review, American Economic Association, vol. 92(2), pages 344-348, May.
    8. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2007. "From the Cradle to the Labor Market? The Effect of Birth Weight on Adult Outcomes," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(1), pages 409-439.
    9. Haegeland, Torbjørn & Kirkeboen, Lars & Raaum, Oddbjørn & Salvanes, Kjell G., 2010. "Why Children of College Graduates Outperform their Schoolmates: A Study of Cousins and Adoptees," IZA Discussion Papers 5369, Institute of Labor Economics (IZA).
    10. Arnaud Chevalier, 2004. "Parental Education and Childs Education: A Natural Experiment," CEE Discussion Papers 0040, Centre for the Economics of Education, LSE.
    11. Holmlund, Helena, 2007. "A Researcher's Guide to the Swedish Compulsory School Reform," Working Paper Series 9/2007, Stockholm University, Swedish Institute for Social Research.
    12. Erik Plug, 2004. "Estimating the Effect of Mother's Schooling on Children's Schooling Using a Sample of Adoptees," American Economic Review, American Economic Association, vol. 94(1), pages 358-368, March.
    13. Imbens, Guido W & Angrist, Joshua D, 1994. "Identification and Estimation of Local Average Treatment Effects," Econometrica, Econometric Society, vol. 62(2), pages 467-475, March.
    14. Bound, John & Solon, Gary, 1999. "Double trouble: on the value of twins-based estimation of the return to schooling," Economics of Education Review, Elsevier, vol. 18(2), pages 169-182, April.
    15. Costas Meghir & Mårten Palme, 2005. "Educational Reform, Ability, and Family Background," American Economic Review, American Economic Association, vol. 95(1), pages 414-424, March.
    16. Isacsson, Gunnar, 1999. "Estimates of the return to schooling in Sweden from a large sample of twins," Labour Economics, Elsevier, vol. 6(4), pages 471-489, November.
    17. Björklund, Anders & Lindahl, Mikael & Plug, Erik, 2004. "Intergenerational Effects in Sweden: What Can We Learn from Adoption Data?," IZA Discussion Papers 1194, Institute of Labor Economics (IZA).
    18. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2005. "Why the Apple Doesn't Fall Far: Understanding Intergenerational Transmission of Human Capital," American Economic Review, American Economic Association, vol. 95(1), pages 437-449, March.
    19. Helena Holmlund & Mikael Lindahl & Erik Plug, 2011. "The Causal Effect of Parents' Schooling on Children's Schooling: A Comparison of Estimation Methods," Journal of Economic Literature, American Economic Association, vol. 49(3), pages 615-651, September.
    20. Dorothe Bonjour & Lynn F. Cherkas & Jonathan E. Haskel & Denise D. Hawkes & Tim D. Spector, 2003. "Returns to Education: Evidence from U.K. Twins," American Economic Review, American Economic Association, vol. 93(5), pages 1799-1812, December.
    21. Jere R. Behrman & Mark R. Rosenzweig, 2005. "Does Increasing Women's Schooling Raise the Schooling of the Next Generation? Reply," American Economic Review, American Economic Association, vol. 95(5), pages 1745-1751, December.
    22. Case, Anne & Lin, I-Fen & McLanahan, Sara, 2000. "How Hungry Is the Selfish Gene?," Economic Journal, Royal Economic Society, vol. 110(466), pages 781-804, October.
    23. Cunha, Flavio & Heckman, James J. & Lochner, Lance, 2006. "Interpreting the Evidence on Life Cycle Skill Formation," Handbook of the Economics of Education, in: Erik Hanushek & F. Welch (ed.), Handbook of the Economics of Education, edition 1, volume 1, chapter 12, pages 697-812, Elsevier.
    24. Philip Oreopoulos, 2006. "Estimating Average and Local Average Treatment Effects of Education when Compulsory Schooling Laws Really Matter," American Economic Review, American Economic Association, vol. 96(1), pages 152-175, March.
    25. Corak,Miles (ed.), 2004. "Generational Income Mobility in North America and Europe," Cambridge Books, Cambridge University Press, number 9780521827607, September.
    26. Lídia Farré & Roger Klein & Francis Vella, 2012. "Does Increasing Parents’ Schooling Raise the Schooling of the Next Generation? Evidence Based on Conditional Second Moments," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 74(5), pages 676-690, October.
    27. Costas Meghir & Mårten Palme, 2003. "Ability, parental background and educational policy: empirical evidence from a social experiment," IFS Working Papers W03/05, Institute for Fiscal Studies.
    28. Gary S. Becker & Nigel Tomes, 1994. "Human Capital and the Rise and Fall of Families," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, Third Edition, pages 257-298, National Bureau of Economic Research, Inc.
    29. Eric Maurin & Sandra McNally, 2008. "Vive la Révolution! Long-Term Educational Returns of 1968 to the Angry Students," Journal of Labor Economics, University of Chicago Press, vol. 26(1), pages 1-33.
    30. Jere R. Behrman & Mark R. Rosenzweig, 2004. "Returns to Birthweight," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 586-601, May.
    31. Lindeboom, Maarten & Llena-Nozal, Ana & van der Klaauw, Bas, 2009. "Parental education and child health: Evidence from a schooling reform," Journal of Health Economics, Elsevier, vol. 28(1), pages 109-131, January.
    32. Dalton Conley & Kate Strully & Neil G. Bennett, 2003. "A Pound of Flesh or Just Proxy? Using Twin Differences to Estimate the Effect of Birth Weight on Life Chances," NBER Working Papers 9901, National Bureau of Economic Research, Inc.
    33. Ashenfelter, Orley & Krueger, Alan B, 1994. "Estimates of the Economic Returns to Schooling from a New Sample of Twins," American Economic Review, American Economic Association, vol. 84(5), pages 1157-1173, December.
    34. Salvanes, Kjell G & Black, Sandra & Devereux, Paul J., 2003. "Why the Apple Doesn't Fall: Understanding Intergenerational Transmission of Human Capital," CEPR Discussion Papers 4150, C.E.P.R. Discussion Papers.
    35. Orley Ashenfelter & Cecilia Rouse, 1998. "Income, Schooling, and Ability: Evidence from a New Sample of Identical Twins," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(1), pages 253-284.
    36. Chiara Pronzato, 2012. "An examination of paternal and maternal intergenerational transmission of schooling," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(2), pages 591-608, January.
    37. Nathan D. Grawe & Casey B. Mulligan, 2002. "Economic Interpretations of Intergenerational Correlations," Journal of Economic Perspectives, American Economic Association, vol. 16(3), pages 45-58, Summer.
    38. Paul Schultz, T., 2002. "Why Governments Should Invest More to Educate Girls," World Development, Elsevier, vol. 30(2), pages 207-225, February.
    39. Dearden, Lorraine & Machin, Stephen & Reed, Howard, 1997. "Intergenerational Mobility in Britain," Economic Journal, Royal Economic Society, vol. 107(440), pages 47-66, January.
    40. Erik Plug & Wim Vijverberg, 2003. "Schooling, Family Background, and Adoption: Is It Nature or Is It Nurture?," Journal of Political Economy, University of Chicago Press, vol. 111(3), pages 611-641, June.
    41. Philip Oreopoulos & Marianne E. Page & Ann Huff Stevens, 2003. "Does Human Capital Transfer from Parent to Child? The Intergenerational Effects of Compulsory Schooling," NBER Working Papers 10164, National Bureau of Economic Research, Inc.
    42. Belzil, Christian & Hansen, Jörgen, 2003. "Structural Estimates of the Intergenerational Education Correlation," IZA Discussion Papers 973, Institute of Labor Economics (IZA).
    43. Solon, Gary, 1999. "Intergenerational mobility in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 29, pages 1761-1800, Elsevier.
    44. SandraE. Black & PaulJ. Devereux & KjellG. Salvanes, 2008. "Staying in the Classroom and out of the maternity ward? The effect of compulsory schooling laws on teenage births," Economic Journal, Royal Economic Society, vol. 118(530), pages 1025-1054, July.
    45. Daron Acemoglu & Joshua Angrist, 2001. "How Large Are Human Capital Externalities? Evidence from Compulsory Schooling Laws," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 9-74, National Bureau of Economic Research, Inc.
    46. de Haan, Monique & Plug, Erik, 2006. "Estimates of the Effect of Parents’ Schooling on Children’s Schooling Using Censored and Uncensored Samples," IZA Discussion Papers 2416, Institute of Labor Economics (IZA).
    47. Robert Haveman & Barbara Wolfe, 1995. "The Determinants of Children's Attainments: A Review of Methods and Findings," Journal of Economic Literature, American Economic Association, vol. 33(4), pages 1829-1878, December.
    48. Gunnar Isacsson, 2004. "Estimating the economic return to educational levels using data on twins," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(1), pages 99-119.
    49. Monique De Haan & Erik Plug, 2011. "Estimating intergenerational schooling mobility on censored samples: consequences and remedies," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(1), pages 151-166, January/F.
    50. Philip Oreopoulos & Marianne E. Page, 2006. "The Intergenerational Effects of Compulsory Schooling," Journal of Labor Economics, University of Chicago Press, vol. 24(4), pages 729-760, October.
    51. Kate L. Antonovics & Arthur S. Goldberger, 2005. "Does Increasing Women's Schooling Raise the Schooling of the Next Generation? Comment," American Economic Review, American Economic Association, vol. 95(5), pages 1738-1744, December.
    52. Bruce Sacerdote, 2007. "How Large are the Effects from Changes in Family Environment? A Study of Korean American Adoptees," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(1), pages 119-157.
    53. Becker, Gary S & Tomes, Nigel, 1979. "An Equilibrium Theory of the Distribution of Income and Intergenerational Mobility," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1153-1189, December.
    54. Jinyong Hahn & Jerry Hausman, 2003. "Weak Instruments: Diagnosis and Cures in Empirical Econometrics," American Economic Review, American Economic Association, vol. 93(2), pages 118-125, May.
    55. repec:ucn:wpaper:10197/317 is not listed on IDEAS
    56. Holmlund, Helena, 2006. "Intergenerational Mobility and Assortative Mating. Effects of an Educational Reform," Working Paper Series 4/2006, Stockholm University, Swedish Institute for Social Research.
    57. Monique de Haan, 2011. "The Effect of Parents' Schooling on Child's Schooling: A Nonparametric Bounds Analysis," Journal of Labor Economics, University of Chicago Press, vol. 29(4), pages 859-892.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Holmlund, Helena & Lindahl, Mikael & Plug, Erik, 2010. "The Causal Eff ect of Parent’s Schooling on Children’s Schooling," Working Paper Series, Center for Labor Studies 2010:8, Uppsala University, Department of Economics.
    2. Petter Lundborg & Martin Nordin & Dan Olof Rooth, 2018. "The intergenerational transmission of human capital: the role of skills and health," Journal of Population Economics, Springer;European Society for Population Economics, vol. 31(4), pages 1035-1065, October.
    3. Hu, Yuan & Behrman, Jere R. & Zhang, Junsen, 2021. "The causal effects of parents’ schooling on children's schooling in urban China," Journal of Comparative Economics, Elsevier, vol. 49(1), pages 258-276.
    4. Monique de Haan, 2011. "The Effect of Parents' Schooling on Child's Schooling: A Nonparametric Bounds Analysis," Journal of Labor Economics, University of Chicago Press, vol. 29(4), pages 859-892.
    5. Arnaud Chevalier & Colm Harmon & Vincent O’ Sullivan & Ian Walker, 2013. "The impact of parental income and education on the schooling of their children," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-22, December.
    6. Nicolas Fleury & Fabrice Gilles, 2015. "A meta-regression analysis on intergenerational transmission of education: publication bias and genuine empirical effect," Working Papers halshs-01143490, HAL.
    7. Dong Zhou & Aparajita Dasgupta, 2017. "Understanding the Intergenerational Transmission of Human Capital: Evidence from a Quasi-natural Experiment in China," Review of Development Economics, Wiley Blackwell, vol. 21(2), pages 321-352, May.
    8. Black, Sandra E. & Devereux, Paul J., 2011. "Recent Developments in Intergenerational Mobility," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 16, pages 1487-1541, Elsevier.
    9. Amin, Vikesh & Lundborg, Petter & Rooth, Dan-Olof, 2015. "The intergenerational transmission of schooling: Are mothers really less important than fathers?," Economics of Education Review, Elsevier, vol. 47(C), pages 100-117.
    10. Mary A. Silles, 2017. "The Intergenerational Transmission of Education: New Evidence from Adoptions in the USA," Economica, London School of Economics and Political Science, vol. 84(336), pages 748-778, October.
    11. Anna Christina D'Addio, 2007. "Intergenerational Transmission of Disadvantage: Mobility or Immobility Across Generations?," OECD Social, Employment and Migration Working Papers 52, OECD Publishing.
    12. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2005. "Why the Apple Doesn't Fall Far: Understanding Intergenerational Transmission of Human Capital," American Economic Review, American Economic Association, vol. 95(1), pages 437-449, March.
    13. Dong, Yongqing & Luo, Renfu & Zhang, Linxiu & Liu, Chengfang & Bai, Yunli, 2019. "Intergenerational transmission of education: The case of rural China," China Economic Review, Elsevier, vol. 53(C), pages 311-323.
    14. Gould, Eric & Simhon, Avi, 2011. "Does Quality Time Produce Quality Children? Evidence on the Intergenerational Transmission of Human Capital using Parental Deat," CEPR Discussion Papers 8258, C.E.P.R. Discussion Papers.
    15. Lukáš Lafférs, 2019. "Bounding average treatment effects using linear programming," Empirical Economics, Springer, vol. 57(3), pages 727-767, September.
    16. Meng, Xin & Zhao, Guochang, 2016. "The Long Shadow of the Chinese Cultural Revolution: The Intergenerational Transmission of Education," IZA Discussion Papers 10460, Institute of Labor Economics (IZA).
    17. Eric D. Gould & Avi Simhon & Bruce A. Weinberg, 2020. "Does Parental Quality Matter? Evidence on the Transmission of Human Capital Using Variation in Parental Influence from Death, Divorce, and Family Size," Journal of Labor Economics, University of Chicago Press, vol. 38(2), pages 569-610.
    18. Meng, Xin & Zhao, Guochang, 2021. "The long shadow of a large scale education interruption: The intergenerational effect," Labour Economics, Elsevier, vol. 71(C).
    19. Marc Piopiunik, 2011. "Microeconometric Analyses of Education Production in Germany," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 40.
    20. Lundborg, Petter & Nordin, Martin & Rooth, Dan-Olof, 2011. "The Intergenerational Transmission of Human Capital: Exploring the Role of Skills and Health Using Data on Adoptees and Twins," IZA Discussion Papers 6099, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    education; intergenerational mobility; selection; causation; identification;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp3630. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.