Changes in Compulsory Schooling, Education and the Distribution of Wages in Europe

Abstract

Using data from 12 European countries and the variation across countries and over time in the changes of minimum school leaving age, we study the effects of the quantity of education on the distribution of earnings. We find that compulsory school reforms significantly affect educational attainment, especially among individuals belonging to the lowest quantiles of the distribution of ability. There is also evidence that additional education reduces conditional wage inequality, and that education and ability are substitutes in the earnings function

Cognitive skills and the LOGSE reform in Spain: evidence from PIAAC

“…Therefore, the results suggest that the LOGSE reform did not help to increase cognitive skills of the population despite an extension of compulsory years of education and postponement of the age of initial tracking into vocational and academic studies. The results contrast with wide evidence that shows a positive effect of years of compulsory education (Brunello et al 2009;Gathmann et al 2015;Meyer 2017), but is in line with other studies that find no effect of the age of initial tracking (Braga et al 2013;Malamud and Pop-Eleches 2010). The conclusions of the present analysis are also consistent with Felgueroso et al (2014) in that "overall, the average of effect of the LOGSE seems to be at least not positive".…”

“…number of students with no higher secondary diploma-by 2.5% points according to Cabus and De Witte (2011). Furthermore, compulsory education laws have been used as a source of exogenous variation to estimate the causal effect of schooling on several outcomes like earnings (Angrist and Keueger 1991;Brunello et al 2009), health (Brunello et al 2013;Gathmann et al 2015), political ideology (Meyer 2017), or attitudes towards immigration (d'Hombres and Nunziata 2016).…”

“…There is a wide evidence supporting that increasing compulsory school age have a positive effect on educational attainment. For example, Brunello et al (2009) used information on reforms that took place over the 1949-1983 period in 12 Western European countries and estimate that the effect of one additional year of compulsory education is close to 0.3 years of schooling. A positive effect of years of compulsory education has also been estimated by other authors using data for similar sets of countries (Gathmann et al 2015;Meyer 2017).…”

Schooling in adolescence raises IQ scores

“…Because the introduction of the reform took place in different municipalities in different years, we are able to use a number of different strategies to account for correlation between individuals living in the same communities as well as for time trends in IQ scores during the relevant period (i.e., the Flynn effect) (14). The quasiexperimental nature of this reform has been previously used to study the effect of education on a number of other outcomes in Norway (15)(16)(17)(18), and similar reforms in other countries have also been extensively used to study the effect of education on earnings (19)(20)(21)(22).…”

The Earnings Returns to Graduating with Honors: Evidence from Law Graduates

“…Most of our understanding about the importance of education is from estimating causal effects of an additional year of schooling. To achieve identification, scholars have used instrumental variable approaches based, for instance, on distance to institutions of education (Card, 1993;Altonji et al, 2005a;Freier and Storck, 2012), or changes in compulsory schooling laws (Angrist and Krueger, 1991;Harmon and Walker, 1995;Oreopoulos, 2006;Pischke and Wachter, 2008;Brunello et al, 2009).…”