Overeducation and Mismatch in the Labor Market

This paper surveys the economics literature on overeducation. The original motivation to study this topic were reports that the strong increase in the number of college graduates in the early 1970s in the US led to a decrease in the returns to college education. We argue that Duncan and Hoffman’s augmented wage equation – the workhorse model in the overeducation literature – in which wages are regressed on years of overschooling, years of required schooling and years of underschooling is at best loosely related to this original motivation. We discuss measurement and estimation issues and give an overview of the main empirical findings in this literature. Finally we given an appraisal of the economic lessons learned.mismatch, overschooling, underschooling, wage equation

Quasi-Experimental Estimates of the Effect of Class Size on Achievement in Norway

Using a comprehensive administrative database we exploit independent quasi-experimental methods to estimate the effect of class size on student achievement in Norway. The first method is based on a maximum class size rule in the spirit Angrist and Lavy (1999). The second method exploits population variation as first proposed by Hoxby (2000). The results of both methods (and of variations on these methods) are very similar and cannot reject that the class size effect is equal to zero. The estimates are very precise; we can rule out effects as small as 1.5 percent of a standard deviation for a one student change in class size during three years in a row.class size, educational production

Scale Economies Can Offset the Benefits of Competition: Evidence from a School Consolidation Reform in a Universal Voucher System

A large school consolidation reform in the Netherlands changed minimum school size rules underlying public funding. The supply of schools decreased by 15 percent, but this varied considerably across municipalities. We find that reducing the number of schools by 10 percent increases pupils' achievement by 3 percent of a standard deviation. A reduction in the supply of schools implies, for a given number of pupils, an increase in average school size. We present evidence that in our context scale economies dominated the effects of choice and competition. This points to an often ignored trade-off between scale and competition.school choice, competition, school consolidation, achievement, economies of scale

New evidence on the effect of time in school on early achievement

This study estimates the effect of expanding enrollment possibilities in early eduction on the achievement of young children. To do so it exploits two features of the Dutch schooling system. First, children are allowed to enroll in school on their fourth birthday. Second, children having their birthday before, during and after the summer holiday are placed in the same class. Together these features generate sufficient exogenous variation in children s potential time in school to identify its effects on test scores. We find that allowing disadvantaged pupils to start school one month earlier increases their test scores on average by 0.06 of a standard deviation. This effect is of the same magnitude for pupils with lower educated parents and for minority pupils. For non- disadvantaged pupils we find no effect. Results are similar for language and math scores.Early childhood intervention, early test scores

The e ect of financial rewards on students achievement: Evidence from a randomized experiment

This paper reports about a randomized field experiment in which first year economics and business students at the University of Amsterdam could earn financial rewards for passing the first year requirements within one year. Participants were assigned to a high, low and zero (control) reward group. The passing rate and the numbers of collected credit point are not statistically di erent across the three groups. We do find some evidence for heterogeneous treatment effects. In particular, high ability students and students from higher social backgrounds have higher passing rates and collect more credit points when assigned to (higher) reward groups. Students in the reward groups, however, do not report to have studied more hours.financial incentives, student achievement, randomized social experiment, heterogeneous treatment effects, university education

The Effect of Extra Funding for Disadvantaged Pupils on Achievement

This paper evaluates the effects of two subsidies targeted at disadvantaged pupils in the Netherlands. The first scheme gives primary schools with at least 70 percent minority pupils extra funding for personnel. The second scheme gives primary schools with at least 70 percent pupils from different disadvantaged groups extra funding for computers and software. The cutoffs at 70 percent provide a regression discontinuity design which we exploit in a local difference-in-differences framework. For both subsidies we find negative point estimates. For the personnel subsidy these are in most cases not significantly different from zero. For the computer subsidy we find more evidence of negative effects. We discuss several explanations for these counterintuitive results.policy evaluation; disadvantaged students; computers; teachers; regression discontinuity

Broadband Internet: An Information Superhighway to Sex Crime?

Does internet use trigger sex crime? We use unique Norwegian data on crime and internet adoption to shed light on this question. A public program with limited funding rolled out broadband access points in 2000-2008, and provides plausibly exogenous variation in internet use. Our instrumental variables and fixed effect estimates show that internet use is associated with a substantial increase in reported incidences of rape and other sex crimes. We present a theoretical framework that highlights three mechanisms for how internet use may affect reported sex crime, namely a reporting effect, a matching effect on potential offenders and victims, and a direct effect on crime propensity. Our results indicate that the direct effect is non-negligible and positive, plausibly as a result of increased consumption of pornography.rape, sex crimes, instrumental variables, broadband, internet, pornography

The effect of financial rewards on students' achievement: Evidence from a randomized experiment

In a randomized field experiment where first year university students could earn financial rewards for passing all first year requirements within one year we find small and non-significant average effects of financial incentives on the pass rate and the numbers of collected credit points. There is however evidence that high ability students collect significantly more credit points when assigned to (larger) reward groups. Low ability students collect less credit points when assigned to larger reward groups. After three years these effects have increased, suggesting dynamic spillovers. The small average effect in the population is therefore the sum of a positive effect for high ability students and a (partly) off-setting negative effect for low ability students. A negative effect of financial incentives for less able individuals is in line with research from psychology and recent economic laboratory experiments which shows that external rewards may be detrimental for intrinsic motivation.financial incentives, student achievement, randomized social experiment, heterogeneous treatment effects higher education policy

Incentives versus Sorting in Tournaments: Evidence from a Field Experiment

A vast body of empirical studies lends support to the incentive effects of rank-order tournaments. Evidence comes from experiments in laboratories and non-experimental studies exploiting sports or firm data. Selection of competitors across tournaments may bias these non-experimental studies, whereas short task duration or lack of distracters may limit the external validity of results obtained in lab experiments or from sports data. To address these concerns we conducted a field experiment where students selected themselves into tournaments with different prizes. Within each tournament the best performing student on the final exam of a standard introductory microeconomics course could win a substantial financial reward. A standard non-experimental analysis exploiting across tournament variation in reward size and competitiveness confirms earlier findings. We find however no evidence for effects of tournament participation on study effort and exam results when we exploit our experimental design, indicating that the non-experimental results are completely due to sorting. Treatment only affects attendance of the first workgroup meeting following the announcement of treatment status, suggesting a difference between short-run and long-run decision making.tournaments, incentives, sorting, field experiments