Biases in Twin Estimates of the Return to Schooling: A Note on Recent Research / David Neumark.

Format:

Book

Author/Creator:

Neumark, David.

Contributor:

National Bureau of Economic Research.

Series:

Technical Working Paper Series (National Bureau of Economic Research) no. t0158.

NBER technical working paper series no. t0158

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Biases in Twin Estimates of the Return to Schooling

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1994.

Summary:

Ashenfelter and Krueger's (1993) within-twin, measurement-error- corrected estimate of the return to schooling is about 13-16 percent. If their estimate is unbiased, then their results imply considerable downward measurement error bias in uncorrected within-twin estimates of the return to schooling, and considerable downward omitted ability bias in cross-section estimates. This note points out that if there are ability differences among twins, then AK's IV estimator exacerbates the omitted ability bias in the within-twin estimate. Thus, upward omitted ability bias in within-twin estimates may provide an alternative explanation of the surprisingly high estimates of the return to schooling that AK obtain, and permit their results to be reconciled with upward, rather than downward omitted ability bias in cross-section estimates.

Notes:

Print version record

June 1994.