This paper studies the ordinary least-squares (OLS) and instrumental variable (IV) estimates of the returns to schooling for male workers in Spain. OLS estimates are often biased due to the endogeneity of schooling, measurement errors or omitted variables. Proper IV estimates correct this bias. The reliability of family background, natural experiments (based on changes in the education system and season of birth) and the availability of a college in the province is checked using Spanish data. The results suggest that background and college availability are valid instruments and that the IV estimates of the returns to schooling are higher than OLS estimates. These results are in line with the majority of previous results in the literature.LABOUR 16 (4) 747-770 (2002) JEL C13, C20, I21, J24# 2002 CEIS, Fondazione London. The department's hospitality is gratefully acknowledged. The authors thank J. Haskel for his helpful comments and P. J. Herna´ndez and A. Lo´pez for providing the information on the availability of a college in the province of residence. This research was supported by CICYT, project SEC-99 -0820, and DGEUI, project 3986-TECNOTUR.Notes: a When the variable unemployment (16) is not included, the returns to schooling estimate is less efficient but similar results are found. Seven dummy variables that capture the geographical area are included. Pv: critical significance level. Robust standard errors are in parentheses.

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This article is a new look at the study of the unemployment insurance effect on the transition probability from unemployment into wage employment in Spain. It is found that individuals increase their search effort and reduce their reservation wage as the unemployment insurance benefit entitlement exhaustion approaches, and their exit rate equals that of the unemployed who never got benefits from the exhaustion moment. Financial constraints are not important in Spain. Business cycle affects more to long-term unemployed. And, finally, it is found that the probability of being offered a vacancy decreases with time spent in unemployment, having allowed for unobservable heterogeneity.

Job exit of men over the age of forty is described and analysed using monthly observations derived from the 1988-89 UK Retirement Survey. A competing risks model is described and estimated. The results show that tenure and age determine transitions from a job to a new one, whereas those transitions from a job to unemployment are also determined by business cycle variables.