Living arrangements of children

Type Book
Title Living arrangements of children
Publication (Day/Month/Year) 1999
Publisher US Department of Commerce, Economics and Statistics Administration, US Bureau of the Census
Average schooling in US states is highly correlated with state wage levels, even
after controlling for the direct effect of schooling on individual wages. We use an
instrumental variables strategy to determine whether this relationship is driven by
social returns to education. The instruments for average schooling are derived
from information on the child labor laws and compulsory attendance laws that
affected men in our Census samples, while quarter of birth is used as an instrument
for individual schooling. This results in precisely estimated private returns to
education of about 7 percent, and small social returns, typically less than 1 percent,
that are not significantly different from zero.

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