Estimating returns to education: three natural experiment techniques compared

Andrew Leigh and Chris Ryan compare three quasi-experimental approaches to estimating the returns to schooling in Australia: instrumenting schooling using month of birth, instrumenting schooling using changes in compulsory schooling laws, and comparing outcomes for twins. Abstract With annual pre-tax income as our measure of income, we find that the naïve (OLS) returns to an additional year of schooling is 13%. The month of birth IV approach gives an 8% rate of return to schooling, while using changes in compulsory schooling laws as an IV produces a 12% rate of return. Finally, we review estimates from twins studies. While we estimate a higher return to education than previous studies, we believe that this is primarily due to the better measurement of income and schooling in our dataset. Australian twins studies are consistent with our findings insofar as they find little evidence of ability bias in the OLS rate of return to schooling. Our estimates of the ability bias in OLS estimates of the rate of return to schooling range from 9% to 39%. Overall, our findings suggest the Australian rate of return to education, corrected for ability bias, is around 10%, which is similar to the rate in Britain, Canada, the Netherlands, Norway and the United States

Incidence and Salience of Alcohol Taxes: Do Consumers Overreact?

We use a unique, geocoded micro data set of retail prices to estimate the incidence of alcohol taxation. We estimate the pass-through of alcohol taxation employing both standard ordinary least squares (OLS) and a regression discontinuity design (RDD), using the abrupt change in excise tax occurring at state borders for identification. Our results show that sales and excise taxes on alcohol have different effects on final consumer price. Our estimates suggest that while 40 percent to 50 percent of sales taxes are passed on to consumers, excise taxes have a negative pass-through rate. Negative rates of pass-through on the excise portion of the alcohol tax are likely the result of consumers overreacting to the tax compared to how they would react to a general price increase, or that the alcohol tax is quite salient for consumers. This effect is particularly strong in areas near state borders when using the RDD estimation strategy

Protecting and Promoting the Human Right to Respect for Family Life: Treaty-Based Reform and Domestic Advocacy

This article examines the right to respect for family life in international law, focusing on its underlying principles and explicit protections. The article identifies these legal norms so that drafters of international treaties, specifically the International Migrants Bill of Rights, and United States legal practitioners representing immigrant children can incorporate the right to respect for family life into their drafting and advocacy, thereby protecting and promoting this critical human right. To encourage both high-level, international treaty-based reform and the grassroots domestic advocacy necessary to comprehensively protect and promote this right, this article provides specific ideas for incorporating the right to respect for family life into (1) the International Migrants Bill of Rights and (2) the United States immigration advocacy process. Section II identifies the principles that underlie the right to respect for family life, especially as it relates to children: (1) that family is the natural and fundamental unit of society and (2) that maintaining the family unit is in the best interests of the child. It also discusses the individuals to whom the right to respect for family life typically attaches. Section III discusses examples of how courts and U.N. expert bodies, including the European Court of Human Rights and the United Nations Human Rights Committee, apply the right to respect for family life in child and family immigration contexts. Section IV analyzes the themes and reasoning in this case law. Section V discusses specific ideas for further integrating the right to respect for family life into the current version of the International Migrants Bill of Rights. Section VI identifies ways in which United States-based advocates can incorporate the right to respect for family life into their advocacy efforts. Section VII provides a brief conclusion

Magnetization Reversal in Ferromagnetic Spirals via Domain Wall Motion

Domain wall dynamics have been investigated in a variety of ferromagnetic nanostructures for potential applications in logic, sensing, and recording. We present a combination of analytic and simulated results describing the reliable field driven motion of a domain wall through the arms of a ferromagnetic spiral nanowire. The spiral geometry is capable of taking advantage of the benefits of both straight and circular wires. Measurements of the in-plane components of the spirals\u27 magnetization can be used to determine the angular location of the domain wall, impacting the magnetoresistive applications dependent on the domain wall location. The spirals\u27 magnetization components are found to depend on the spiral parameters: the initial radius and spacing between spiral arms, along with the domain wall location. The magnetization is independent of the parameters of the rotating field used to move the domain wall, and therefore the model is valid for current induced domain wall motion as well. The speed of the domain wall is found to depend on the frequency of the rotating driving field, and the domain wall speeds can be reliably varied over several orders of magnitude. We further demonstrate a technique capable of injecting multiple domain walls and show the reliable and unidirectional motion of domain walls through the arms of the spiral

Surviving in a Commoditized Worldy

This paper examines why organizations have adopted a wide range of responses when addressing the opportunities and threats posed by commoditization. Some may choose to focus on their cost base, whilst others may focus on innovation. Whatever strategy is adopted, it will be driven by a range of factors including the market or markets in which the organization operates the nature of its competition and how easy it is for them to become commoditized. This paper will present Ryanair, Wal-Mart, Starbucks, Tesco, General Electric and Dell as examples of which highlight how different organizations have approached the challenge of commoditization. What we can conclude from these is that there are many different ways to tackle commoditization and that many organisations do so successfully. For those organizations which are comfortably outside the commoditized zone, it will give them some insights on what to do should the risk of commoditization increase to a point where action is necessary.Commoditization, Ryanair, Wal-Mart, Starbucks, Tesco, General Electric and Dell

Economic and Business Responses to the Pressures of Commoditization

This paper examines the pressures of commoditization will continue to exert itself on companies and managers everywhere: the increasing impact of demographic change; the requirement to maintain a keen eye on costs in order to compete effectively within the global market; the continued advance of technology; the ability to standardize processes and eliminate major inefficiencies; the pressure to outsource and offshore business activities in order to exploit the cost advantages of cheaper labour and the opportunity for your competition to attack your markets and replicate your products and services more freely.Tackling commoditization in a fragmented or short-termist way will not allow you to understand its effects and nor will it provide the solid platform required to build an effective response. So when it comes to considering the potential impacts of commoditization you need to ask yourself the following two questions: 1. Can all or part of our business become commoditized? It is easy to believe that you are immune to the effects of commoditization and that you don’t need to respond to something that may not even be on your horizon. When responding to this question the best approach is to start from the position that everything you do is capable of becoming commoditized if not now, then certainly at some point in the future. Of course you may find that not everything can be commoditized, but it is far better to come to this conclusion after completing a thorough analysis of your business than making assumptions based upon a limited perspective or worse still, gut feel 2. How should we respond to the threat of commoditization? In particular should we embrace it or avoid it? This is a crucial question to answer once you have understood the threats and opportunities commoditization poses to the organization. As with any strategic decision it is likely to have significant operational implications. In some cases you may find that you have little alternative but to become more commoditized yourself, whilst in others you may be able to adopt a more flexible approach. When considering the response, you will need to think about such things as: • How can we insulate ourselves from the threat of commoditization? • Given the choice what parts of our business should we allow to become commoditized? • Where and in which markets should we innovate as a way of avoiding the commoditization trap? • Where should we target our investments – with our customers, on our back office processes, in research and development, on acquisitions or all of the above?Commoditization, Offshoring, Talent, Technology, Competition, Inequality

Estimating Returns to Education: Three Natural Experiment Techniques Compared

We compare three quasi-experimental approaches to estimating the returns to schooling in Australia: instrumenting schooling using month of birth, instrumenting schooling using changes in compulsory schooling laws, and comparing outcomes for twins. With annual pre-tax income as our measure of income, we find that the naïve (OLS) returns to an additional year of schooling is 13%. The month of birth IV approach gives an 8% rate of return to schooling, while using changes in compulsory schooling laws as an IV produces a 12% rate of return. Finally, we review estimates from twins studies. While we estimate a higher return to education than previous studies, we believe that this is primarily due to the better measurement of income and schooling in our dataset. Australian twins studies are consistent with our findings insofar as they find little evidence of ability bias in the OLS rate of return to schooling. Our estimates of the ability bias in OLS estimates of the rate of return to schooling range from 9% to 39%. Overall, our findings suggest the Australian rate of return to education, corrected for ability bias, is around 10%, which is similar to the rate in Britain, Canada, the Netherlands, Norway and the United States.returns to education, instrumental variables, compulsory schooling, twins, Australia

Where will commoditization take us?

Predicting the future is an imprecise science, and something that should always be carried out carefully and the results should be taken with a pinch of salt. That said it is sensible to assume that most of the drivers of commoditization are likely to remain in force for the foreseeable future. Unlike the futurologists who attempt to predict how society and technology will change over the next fifty years, we are only going to look a few years ahead, which is a more sensible time horizon. History is not always a good predictor of the future, but in the case of commoditization we think it is. It is clear that when we look back in time we can see how the process of commoditization has subsumed great tranches of industry, eliminated significant numbers of manual labourers and increased the general efficiency and effectiveness of society. In many respects we could argue that it was important to the advancement of the industrialised economies of the West. In projecting forward from this point, we should expect commoditization to continue to expand its footprint into areas which we currently think are outside of the realms of possibility. After all, no one would have expected the IT industry to have become so commoditized when it first emerged during the 1940s. And in the same way that white collar workers were caught out when they believed they were immune from the initial waves of downsizing and offshoring that affected the manufacturing sector, others at the mid- and high-end of the workforce may also be caught out sometime in the future. And as commoditization continues to advance it will touch on many more peoples’ lives and livelihoods.Commoditization, Offshoring, Talent, Technology, Competition, Inequality

Surviving in a Commoditized World

This paper examines why organizations have adopted a wide range of responses when addressing the opportunities and threats posed by commoditization. Some may choose to focus on their cost base, whilst others may focus on innovation. Whatever strategy is adopted, it will be driven by a range of factors including the market or markets in which the organization operates the nature of its competition and how easy it is for them to become commoditized. This paper will present Ryanair, Wal-Mart, Starbucks, Tesco, General Electric and Dell as examples of which highlight how different organizations have approached the challenge of commoditization. What we can conclude from these is that there are many different ways to tackle commoditization and that many organisations do so successfully. For those organizations which are comfortably outside the commoditized zone, it will give them some insights on what to do should the risk of commoditization increase to a point where action is necessary.Commoditization, Ryanair, Wal-Mart, Starbucks, Tesco, General Electric and Dell