Sexual Orientation, Disclosure and Earnings

Gay/bisexual workers tend to earn less than other men. Does this occur because of discrimination or because of selection? In this paper we address this question and collect new information on workplace disclosure to separate out discrimination effects from selection effects. Using a large sample of recently graduated men in the Netherlands, we find that gay/bisexual workers earn about 3 to 4 percent less than other men. Our disclosure estimates, however, provide little evidence that the labor market discriminates against gay/bisexual workers. They rather support the selection story, most prominently observed among undisclosed gay/bisexual workers who concentrate in lower paid occupations, and earn about 5 to 9 percent less than other men.sexual orientation, disclosure, earnings, discrimination, selection

How Do Parents Raise the Educational Attainment of Future Generations?

The problem with most intergenerational mobility estimates is that unmeasured and inherited abilities prevent us from drawing inferences. In this paper we estimate the intergenerational mobility of schooling and exploit differences between adopted and own birth children to obtain genetically unbiased estimates. Our results provide a much better insight on whether parents (and policy makers) can actually stimulate the educational attainment of future generations. Controlling for inherited abilities and assortative mating we find that the association between mother's (but not father's) and child schooling disappears

The Causal Effect of Parent’s Schooling on Children’s Schooling: A Comparison of Estimation Methods

Recent studies that aim to estimate the causal link between the education of parents and their children provide evidence that is far from conclusive. This paper explores why. There are a number of possible explanations. One is that these studies rely on different data sources, gathered in different countries at different times. Another one is that these studies use different identification strategies. Three identification strategies that are currently in use rely on: identical twins; adoptees; and instrumental variables. In this paper we apply each of these three strategies to one particular Swedish data set. The purpose is threefold: (i) explain the disparate evidence in the recent literature; (ii) learn more about the quality of each identification procedure; and (iii) get at better perspective about intergenerational effects of education. We find that the three identification strategies all produce intergenerational schooling estimates that are lower than the corresponding OLS estimates, indicating the importance of accounting for ability bias. But interestingly, when applying the three methods to the same data set, we are able to fully replicate the discrepancies across methods found in the previous literature. Our findings therefore indicate that the estimated impact of parental education on that of their child in Sweden does depend on identification, which suggests that country and cohort differences do not lie behind the observed disparities. Finally, we conclude that income is a mechanism linking parent’s and children’s schooling, that can partly explain the diverging results across methods.intergenerational mobility, education, causation, selection, identification

Sexual Orientation, Prejudice and Segregation

This paper examines whether gay and lesbian workers sort into tolerant occupations. With information on sexual orientation, prejudice and occupational choice taken from Australian Twin Registers, we find that gays and lesbians shy away from prejudiced occupations. We show that our segregation results are largely driven by those gay and lesbian workers with disclosed identities, and robust to the inclusion of unobserved factors that are inherited and observed factors that strongly correlate with productive skills and vocational preferences. Our segregation estimates are generally large and consistent with prejudice based theories of employer and employee discrimination against gay and lesbian workers.sexual orientation, occupational choice, discrimination, segregation

The Causal Effect of Parents' Schooling on Children's Schooling - A Comparison of Estimation Methods

We review the empirical literature that estimates the causal effect of parent’s schooling on child’s schooling, and conclude that estimates differ across studies. We then consider three explanations for why this is: (a) idiosyncratic differences in data sets; (b) differences in remaining biases between different identification strategies; and (c) differences across identification strategies in their ability to make out-of-sample predictions. We conclude that discrepancies in past studies can be explained by violations of identifying assumptions. Our reading of past evidence, together with an application to Swedish register data, suggests that intergenerational schooling associations are largely driven by selection. Parental schooling constitutes a large part of the parental nurture effect, but as a whole does not play a large role.intergenerational mobility, education, causation, selection, identification

Schooling, family background, and adoption: Is it nature or is it nurture?

When parents are more educated, their children tend to receive more schooling as well. Does this occur because parental ability is passed on genetically or because more educated parents provide a better environment for children to flourish? Using an intergenerational sample of families, we estimate on the basis of a comparison of biological and adopted children that about 65 to 80 percent of the parental ability is genetically transmitted.Mitä korkeammin koulutetut vanhemmat sitä pidemmälle yleensä myös lapset kouluttautuvat. Johtuuko tämä siitä, että vanhempien etevyys siirtyy geneettisesti jälkipolvelle, vai tarjoavatko korkeammin koulutetut vanhemmat lapsilleen paremman ympäristön harjoittaa kykyjään ja menestyä? Käyttäessämme sukupolvivaihtelut huomioivaa otosta eri perheistä, tulee biologisten ja adoptoitujen lasten vertailun pohjalta tehtyjen estimointien tulokseksi se, että noin 65-80 % vanhempien kyvykkyydestä välittyy geneettisesti

Estimates of the effect of parents' schooling on children's schooling using censored and uncensored samples

In this paper we estimate the impact of parental schooling on child schooling, focus on the problem that children who are still in school constitute censored observations, and evaluate three solutions to it: maximum likelihood approach, replacement of observed with expected years of schooling, and elimination of all school-aged children. Plug (2004) - a recent mobility study that relies on censored data - serves as an illustration. With updated and uncensored versions of previous samples, we re-examine Plug's estimates and test how the three correction methods deal with censored observations. The one that treats parental expectations as if they were realizations seems to fix the censoring problem quite well

Estimating the Effect of Personality on Male-Female Earnings

This paper uses the Five-Factor Model of personality structure as an organizing framework to explore the effects of personality on earnings. Using data from a longitudinal survey of American high school graduates, we find that extroversion, agreeableness, conscientiousness, neuroticism and openness to experience are rewarded/penalized significantly and differentially across genders. Antagonistic, emotionally stable and open men enjoy substantial earnings advantages over otherwise similar individuals. In case of women, the labor market appears to value conscientiousness and openness to experience. The positive returns to openness are very similar across genders, suggesting that being creative, unconventional and artistic is equally important for men and women working in all types of occupations. Moreover, we find significant gender differences in personality characteristics. Decomposition of personality-based earnings differentials into trait and parameter effects suggests that gender-atypical traits reduce the earnings advantage that individuals would otherwise enjoy under their own-sex wage structure. Overall, we find that the impact of personality on earnings is significant but not large --not trivial either-- and comparable to the impact of differences in cognitive ability

Schooling Family, Background, and Adoption: Does Family Income Matter?

One would expect that family income is an important positive factor in the school attainment of children. However, evidence on this relationship is often tainted by the lack of control for parental ability, since at least a portion of ability is transferred genetically to children. This paper considers empirical strategies that control for both observed and unobserved parental ability. In the end, family income still has a significant effect, which must therefore be causative. It implies that high-ability children in low-income families face binding credit constraints that society may wish to relieve