Double Trouble: On the Value of Twins-Based Estimation of the Return to Schooling / John Bound, Gary Solon.

Format:

Book

Author/Creator:

Bound, John.

Contributor:

National Bureau of Economic Research.

Solon, Gary.

Series:

Working Paper Series (National Bureau of Economic Research) no. w6721.

NBER working paper series no. w6721

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Double Trouble

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1998.

Summary:

Several recent studies use the schooling and wage variation between monozygotic twins to estimate the return to schooling. In this paper, we summarize the results from this literature, and we examine the implications of endogenous determination of which twin goes to school longer and of measuring schooling with (possibly mean-reverting) error. Endogeneity of between-twins schooling variation is strongly suggested by the extensive (mostly non-economic) literature documenting that the between-twins difference in birth weight is correlated with the between-twins differences in both schooling and IQ. We conclude that twins-based estimation is vulnerable to the same sort of inconsistency that afflicts conventional cross-sectional estimation. We argue, however, that, if one starts with the presumption that endogenous schooling induces upward inconsistency in the estimated return to schooling, the new twins-based estimates may complement other approaches to tightening the upper bound on the return to schooling.

Notes:

Print version record

September 1998.