the international monetary fund and developing countries a review of the evidence and policy options as its systemic role evaporated with the collapse of the bretton woods system so the international monetary fund imf became drawn into a much more specific role in the context of the balance of payments bop problems that developing countries were encountering at its inception the imf had been seen as having no specific role in developing countries but now it became exclusively these countries that formed its clientele while during the 1970s the imf had continued to make a few relatively large loans to a limited number of industrial countries italy and the united kingdom beyond the mid 1970s industrial countries ceased to draw any resources from it

the incentive effects of medicaid on women s labor supply this paper investigates medicaid s impact on women s labor supply behavior while taking into account medicaid s link to the afdc program the data were extracted from the 1986 current population survey a majorfinding is that medicaid valued as government provided health insurance has a significant negative impact on an average female head s probability of working for instance a i0 percent increase in medicaid would reduce a head s probability of working by 9 to 1 3 percentage points contrary to expectations medicaid is found to have a generally insignificant effect on hours worked

gentrification and failing schools the unintended consequences of school choice under nclb we examine the housing market and residential mobility changes that occur soon after a title 1 school fails to achieve adequate yearly progress ayp in charlotte north carolina students within attendance zones of failing schools are given priority in lotteries for oversubscribed schools potentially increasing the attractiveness of living in a failing school attendance zone we find that housing prices home buyer income and the probability of attending a nonassigned school increase in the highest quality neighborhoods within failing school attendance zones our results are driven largely by the behavior of new residents

turnover in the afdc population an event history analysis the control group of families with female heads from the denver income maintenance experiment is utilized in this analysis of afdc turnover this study uses event history techniques a methodology that is more appropriate for exploring welfare dynamics than the logit approach of earlier work increases in age and the wage have significant negative effects on the rate of entering afdc a higher guarantee raises this rate significantly age and the guarantee have significant effects with opposite signs on the exit rate other variables are not systematically related to turnover the estimates are applied to projected changes in lengths of time spent on and off afdc and in afdc caseloads due to changes in the explanatory variables

the effect of food stamps on labor supply a bivariate selection model abstract although there is a large literature on the effects of u s transfer programs on labor supply this is the first such study of the food stamp program we model the nonlinearity and nonconvexity of the budget constraint and use maximum likelihood methods to estimate hours of work functions for female heads of household the largest recipient group in the program we also model the joint response to afdc and food stamps and we account for the existence of a significant number of eligible households who do not participate in the programs a three equation bivariate selection model is estimated on a sample of eligible households with maximum likelihood

the effect of child support payments on the labor supply of female family heads an econometric analysis recent census bureau statistics show that women who receive child support payments have higher earnings and work longer hours than women who do not does this suggest that child support unlike all other nonwage income does not deter work effort or are women who receive it simply different we use 1979 1982 cps data on divorced or separated women to estimate the determinants of hours worked when afdc participation and child support are endogenous we find evidence of unobservable differences between women who receive child support and those who do not controlling for these both child support and other nonwage income appear to reduce hours worked but the deterrent effect of child support is considerably less

borrowing from the imf the policy implications of recent empirical research abstract at a time when the future of the international monetary fund is being widely debated a number of relevant and important studies have been published which advance our knowledge of the factors which determine borrowing from the fund there has been little attempt however to put this recent empirical research into context or to extract from it appropriate policy conclusions while dissent remains over some issues there is an emerging consensus on others which provides a firm empirical foundation for policy formulation unfortunately the policy stance adopted by the g7 is in many ways at odds with much of the recent empirical research

greek membership and academic performance evidence from student level data abstractcompared to other inputs of the education production function less is known about the effect of social and non classroom choices this study examines whether joining fraternities and sororities improves academic performance in order to account for the self selection bias of greek membership i exploit plausibly exogenous cross class variation in greek student composition at the course instructor level my estimate shows that a 10 percentage point increase in greek student composition translates to a 0 02 standard deviation increase in course grade for greek students relative to non greek students i further find that this effect is driven largely by low achieving and middle achieving white greek members

incentive effects of the u s welfare system a review the author would like to acknowledge support for prior work on this topic from the u s department of health and human services and helpful comments from three anonymous referees rebecca blank howard chernick john fitzgerald irwin garfinkel peter gottschalk edward gramlich david greenberg judith gueron james heckman v joseph hotz robert hutchens michael keane frank levy larry mead michael murray robert plotnick anuradha rangarajan philip robins howard rolston jeffrey smith and daniel weinberg all opinions and errors are those of the author alone

the wisconsin child support assurance system estimated effects on poverty labor supply caseloads and costs the economic impact of a child support assurance system csas is simulated with microdata on custodial families in wisconsin the csas includes a uniform child support standard automatic wage withholding a minimum child support benefit and wage subsidy for eligible families the simulation incorporates a model of the labor supply decision representing the custodial parent s choice of whether to participate in csas or in the current afdc system the results suggest that csas can significantly reduce poverty as well as welfare caseloads if child support collections increase by one half of the difference between estimated ability to pay child support and current collections csas will be less costly than the current system

impact of a tertiary eligibility threshold on tertiary education and earnings a discontinuity approach this study uses a discontinuity in the swedish tertiary eligibility requirement to estimate the probability of enrolling in tertiary education and the payoff thereof regression discontinuity results show that achieving tertiary eligibility in upper secondary education increases the probability of enrolling in tertiary education by around 10 15 and 7 percentage points for students who enrolled on an academic and vocational track respectively for academic students this implies 5 higher earnings for men while for women it increases the probability of having positive incomes by 2 thus academic students at the margin of tertiary education receive a substantial tertiary education payoff jel i21 i26 i28

on intergenerational immobility evidence that adult credit health reflects the childhood environment we examine the persistence of inequality through credit health linking administrative records from several sources we document that childhood circumstances are strongly predictive of financial fragility in adulthood with credit scores among those from disadvantaged backgrounds nearly 100 points lower and 20 percentage points more likely to qualify as subprime we find evidence this relationship reflects differences in human capital and debt management still neither appears to fully explain the relationship our results reveal another dimension along which childhood circumstances persist into adulthood and could mean the many settings that evaluate individuals based on their credit health help reinforce inequities jel d12 e24 i32

the effect of institutional expenditures on employment outcomes and earnings in recent decades public attention on colleges has risen in response to rising college expenditures and costs this study uses the education longitudinal study of 2002 to investigate how spending impacts salaries and employment outcomes controlling for selection our findings indicate that spending on instruction increases salaries the probability of full time employment and job match particularly for more disadvantaged students while there are smaller benefits of spending on student services for less disadvantaged students spending on research has large positive impacts on salary and the probability of full time employment especially for disadvantaged students jel i20 j24

the u s investment tax credit for solar energy alternatives to the anticipated 2017 step down abstract solar photovoltaic pv installations in the united states have been deployed at a rapid pace in recent years a development that is attributed in significant part to the federal investment tax credit itc yet this credit is scheduled to step down from 30 to 10 at the beginning of 2017 for corporate investors for a sample of five u s states and different segments of the solar industry we find that the anticipated itc step down in 2017 would increase the levelized cost of solar power by a significant margin raising the specter of a cliff for the solar industry our analysis identifies and evaluates an alternative phase down scenario that would reduce the itc gradually over time and eliminate it completely by 2024 for this alternative phase down scenario it is shown that solar pv would remain broadly competitive provided the solar industry can maintain the pace of cost reductions demonstrated in past years

broadening the market design approach to school choice school choice refers to policies that allow parents preferences to be an input to the decision of which school a student will attend a rich body of research has developed over the past 10 15 years to study mechanisms that implement school choice this literature has mostly taken the inputs of school choice preferences priorities and capacities as exogenous more recently researchers have sought to embed the school choice problem into its wider context thereby broadening the scope of market design questions and enriching the analysis this article discusses current school choice policy issues in light of this recent literature and outlines remaining open questions

the effect of attending the flagship state university on earnings a discontinuity based approach abstract this paper examines the effect of attending the flagship state university on the earnings of 28 to 33 year olds by combining confidential admissions records from a large state university with earnings data collected through the state s unemployment insurance program to distinguish the effect of attending the flagship state university from the effects of confounding factors correlated with the university s admission decision or the applicant s enrollment decision i exploit a large discontinuity in the probability of enrollment at the admission cutoff the results indicate that attending the most selective state university causes earnings to be approximately 20 higher for white men

external financing and balance of payments adjustment in developing countries getting a better policy mix there are a number of alternative strategies for dealing with current account balance of payments deficits one is to ignore them altogether on the grounds that they do not matter here the argument is that in the long term the imbalance between domestic investment and savings which the deficit reflects will be automatically corrected and that mindful of this private external finance will be available to cover excess expenditure in the short term net capital inflows will finance short term net inward transfers of real resources if in long run equilibrium there is a close positive correlation between investment and saving across countries net external financing will be merely a cyclical deviation from this

flexibility and economic progress we start with a paradox that while its value and the penalties imposed by its absence are casually acknowledged in discussions of economic development there is a near total absence of explicit analytical treatment of the flexibility of economies in the academic literature at the same time there appears a strong prima facie expectation that the flexibility of an economy will strongly influence its long term economic performance and that this attribute is of increasing importance

incentives for early adoption of carbon capture technology abstract we analyze a policy proposal for regulating the next generation of baseload electricity generation facilities in the united states the cornerstone of this regulation is a hypothetical epa mandate for an emission standard of 80 kg of co 2 per mwh of electricity generated the mandate would go into effect at the end of 2027 for all power generating facilities that come into operation after 2017 fossil fuel power plants could meet the standard by capturing between 80 and 90 of their current co 2 emissions while the initial cost of complying with this standard is relatively high for first of a kind facilities learning effects are projected to reduce this cost substantially by the end of 2027 provided new facilities consistently adopt carbon capture technology in the intervening years we identify a combination of investment and production tax credits that provide the required incentives for new facilities to be willing to comply with the standard ahead of the mandate due to the anticipated learning effects the incremental cost associated with the stricter emission limit is projected to about 1 2 per kwh of electricity in the long run

good principals or good peers parental valuation of school characteristics tiebout equilibrium and the incentive effects of competition among jurisdictions good principals or good peers parental valuation of school characteristics tiebout equilibrium and the incentive effects of competition among jurisdictions by j esse m r othstein school choice policies may by aligning admin istrators incentives with parental demand yield improved efficiency in educational production milton friedman 1962 john e chubb and terry m moe 1990 but eric a hanushek 1981 cautions if the efficiency of our school systems is due to poor incentives for teachers and admin istrators coupled with poor decision making by consumers it would be unwise to expect much from programs that seek to strengthen market forces in the selection of schools p 35 empha sis added poor decision making is not required parents may rationally choose schools with pleasant surroundings athletic facilities cultural advantages ibid p 34 over those that most efficiently pursue academic performance they may prefer poorly run schools with good peer groups over those that are more effective but en roll worse students j douglas willms and frank h echols 1992 1993 or they may simply be unable to identify effective schools thomas j kane and douglas o staiger 2002 any factor that leads parents to choose any but the most effective available schools will tend to dilute the incentives for efficient management that choice might otherwise create this study examines the distribution of stu dent outcomes across schools within metropol itan housing markets for evidence on parental demand economists have long noted that par ents choices among residential locations are potentially informative about how more com plete choice systems may operate charles m tiebout 1956 melvin v borland and roy m howsen 1992 caroline m hoxby 2000 rothstein 2005 1 i ask whether school effec tiveness plays a sufficiently important role in these decisions to create meaningful incentives for more productive school management i adopt a specific understanding of effective ness appropriate to the question at hand a substantial portion of between school differ ences in student performance can be attributed to differences in student body composition this portion includes the effects of individual stu dent characteristics on their own test scores any direct peer group effects and any indirect ef fects of a school s composition on the quality of its instruction if wealthy schools attract better teachers joseph r antos and sherwin rosen 1975 or more parental involvement this is for my purposes a peer effect it depends on the quality of the school s administration only via school composition a school administrator cannot attract demand by offering a school with wealthy students as these can be offered only if wealthy families demand the school in the first place only the remaining portion of a school s contribution to test scores is effectiveness 2 department of economics and woodrow wilson school princeton university wallace hall 3 rd floor princeton nj 08544 e mail jrothst princeton edu i thank alan auerbach tom davidoff caroline hoxby jus tin mccrary rob mcmillan john quigley cecilia rouse emmanuel saez till von wachter four anonymous refer ees editor robert moffitt seminar participants at several institutions and especially david card for helpful sugges tions i am grateful to the college board for essential data and to a national science foundation graduate research fellowship and the fisher center for real estate and urban economics at uc berkeley for funding see cecilia elena rouse 1998 julie b cullen et al 2005 william g howell et al 2002 and alan b krueger and pei zhu 2004 for analyses of several existing nonresidential choice programs though none focuses on the particular issue studied here this definition avoids the need to find observable de terminants of effectiveness which have proved elusive hanushek 1986 my definition however ignores a school s contribution to nontest outcomes e g sports or music if such outcomes motivate parental choices i will conclude that parents do not demand effective schools of

the impact of ceta programs on earnings a review of the literature this paper reviews and assesses evaluations of the comprehensive employment and training act ceta programs most of the studies found that the programs raised earnings by 200 to 600 annually in current dollars the programs were found to be more effective for women than men and public service employment and on the job training were generally found to be more effective activities than classroom training and work experience in spite of the broad overall agreement the studies differed significantly in many of their specific impact findings the nonexperimental nature of the data required the studies to make specific assumptions about selection procedures used to determine which individuals received training and the results are sensitive to the specific measures adopted data limitation and the inability to adequately test the validity of selection processes assumed make it impossible to determine which studies modeled the process correctly

jockeying for position strategic high school choice under texas top ten percent plan abstract beginning in 1998 all students in the state of texas who graduated in the top 10 of their high school classes were guaranteed admission to any in state public higher education institution including the flagships while the goal of this policy is to improve college access for disadvantaged and minority students the use of a school specific standard to determine eligibility could have unintended consequences students may increase their chances of being in the top 10 by choosing a high school with lower achieving peers our analysis of students school transitions between 8th and 10th grade three years before and after the policy change reveals that this incentive influences enrollment choices in the anticipated direction among the subset of students with both motive and opportunity for strategic high school choice at least 5 enroll in a different high school to improve the chances of being in the top 10 these students tend to choose the neighborhood high school in lieu of transferring to more competitive schools and regardless of own race typically displace minority students from the top 10 pool relatively few students have both the motive and opportunity to behave strategically in the short run so systemic effects are inherently slight our finding of sizable take up in the face of costly strategizing however suggests that endogenous group membership may be important in the longer run and in other settings where individuals can select their peers and are then graded on a curve

quantile treatment effects of college quality on earnings we use administrative data from texas to estimate how graduating from a state flagship or a community college relative to a nonflagship university affects the distribution of earnings we control for the selection of students across sectors using a rich set of observable ability and background characteristics and find evidence of substantial heterogeneity in the returns to quality returns increase with earnings among ut austin graduates but decline among texas a m graduates for community colleges returns are negative for lower earners but go to zero for higher earners our estimates also point to differences in the distribution of returns by race ethnicity

multifaceted aid for low income students and college outcomes evidence from north carolina we study the evolution of a campus based aid program for low income students that began with grant heavy financial aid and later added a suite of nonfinancial supports we find little to no evidence that program eligibility during the early years 2004 2006 in which students received additional institutional grant aid and few nonfinancial supports improved postsecondary progress performance or completion in contrast program eligible students in more recent cohorts 2007 2010 when the program supplemented grant heavy aid with an array of nonfinancial supports were more likely to meet credit accumulation benchmarks toward timely graduation and earned higher grade point averages than their barely ineligible counterparts jel i21 i23 i24 j08

the effect of housing wealth on college choice evidence from the housing boom we use nlsy97 data to examine how home price variation affects the quality of postsecondary schools students attend we find a 10 000 increase in housing wealth increases the likelihood of public flagship university enrollment relative to nonflagship enrollment by 2 0 percent and decreases the relative probability of attending a community college by 1 6 percent these effects are driven by lower income families predominantly by altering student application decisions we also find home price changes affect direct quality measures of institutions students attend furthermore for lower income students each 10 000 increase in home prices leads to a 1 8 percent increase in the likelihood of completing college

ever tried ever failed no matter on the demotivational effect of losing in repeated competitions abstract many important life goals require repeated confrontation with competitors losing in such competitions may discourage individuals and make them postpone further competitions thereby harming future prospects i use data on 44 799 amateur tennis players who are randomly paired in repeated competitions to study the causal effect of losing on the time to the next tournament participation results show that individuals wait on average 10 longer to enroll again after losing furthermore losing against relatively weaker opponents leads to a discontinuously larger effect than losing against relatively stronger opponents indicating that individuals do not rationally update beliefs about winning probabilities but instead use their ranking as reference point when evaluating defeats

the desegregating effect of school tracking this paper makes the following point detracking schools that is preventing them from allocating students to classes according to their ability may lead to an increase in income residential segregation it does so in a simple model where households care about the school peer group of their children if ability and income are positively correlated tracking implies that some high income households face the choice of either living in the areas where most of the other high income households live and having their child assigned to the low track or instead living in lower income neighbourhoods where their child would be in the high track under mild conditions tracking leads to an equilibrium with partial income desegregation where perfect income segregation would be the only stable outcome without tracking

does it pay to attend an elite private college cross cohort evidence on the effects of college type on earnings although a substantial and rising labor market premium is associated with college attendance in general little is known about how this premium varies across institutions of different types and across time in this paper we explicitly model high school students choice of college type characterized by selectivity and control based on individual and family characteristics including ability and parental economic status and an estimate of the net costs of attendance we estimate selectivity corrected outcome equations using data from both the national longitudinal study of the high school class of 1972 and high school and beyond which permit us to determine the effects of college quality on wages and earnings and how this effect varies across time even after controlling for selection effects strong evidence emerges of a significant economic return to attending an elite private institution and some evidence suggests this premium has increased over time

rates of return to four year university education an application of regression discontinuity design estimating the rate of return to university education is invariably difficult due to the problem of omitted variable bias using a regression discontinuity design we estimate the effect of four year university education on earnings and explore the pathways through which the effect operates our estimation exploits the centralized score based college university admission system in china where the minimum scores required for university admission are externally determined by the provincial governments our findings suggest that being eligible for four year university admission implies a sizable increase in earnings with the payoff being attributable to prolonged length of education and improvements in education quality although the quality effects may not be precisely estimated this article is protected by copyright all rights reserved

income schooling and ability evidence from a new sample of identical twins we develop a model of optimal schooling investments and estimate it using new data on approximately 700 identical twins we estimate an average return to schooling of 9 percent for identical twins but estimated returns appear to be slightly higher for less able individuals simple cross section estimates are marginally upward biased these empirical results imply that abler individuals attain more schooling because they face lower marginal costs of schooling not because of higher marginal benefits

joining the ccs club the economics of co2 pipeline projects this paper examines the conditions for a widespread adoption of carbon capture transport and storage ccs by a group of emitters that can be connected to a common co2 pipeline it details a modeling framework aimed at assessing the critical value in the charge for the co2 emissions required for each of the emitters to decide to implement capture capabilities this model can be used to analyze how the tariff structure imposed on the co2 pipeline operator modifies the overall cost of co2 abatement via ccs this framework is applied to the case of a real european co2 pipeline project we find that the obligation to use cross subsidy free pipeline tariffs has a minor impact on the minimum co2 price required to adopt the ccs in contrast the obligation to charge non discriminatory prices can either impede the adoption of ccs or significantly raise that price besides which we compared two alternative regulatory frameworks for co2 pipelines a common european organization as opposed to a collection of national regulations the results indicate that the institutional scope of that regulation has a limited impact on the adoption of ccs compared to the detailed design of the tariff structure imposed on pipeline operators

economic determinants of imf financial arrangements abstract we analyze factors that lead to imf approval of financial arrangements we account for both economic variables that induce a country to seek an imf arrangement demand side factors and macroeconomic policy commitments that the imf considers when deciding whether to approve it supply side factors using a pooled sample of annual observations for 91 developing countries over 1973 1991 we obtain maximum likelihood bivariate and univariate probit estimates of the approval of an imf arrangement for a given country in a given year a number of demand side and supply side variables are statistically significant determinants of the approval of an imf arrangement

a unified welfare analysis of government policies we conduct a comparative welfare analysis of 133 historical policy changes over the past half century in the united states focusing on policies in social insurance education and job training taxes and cash transfers and in kind transfers for each policy we use existing causal estimates to calculate both the benefit that each policy provides its recipients measured as their willingness to pay and the policy s net cost inclusive of long term impacts on the government s budget we divide the willingness to pay by the net cost to the government to form each policy s marginal value of public funds or its mvpf comparing mvpfs across policies provides a unified method of assessing their impact on social welfare our results suggest that direct investments in low income children s health and education have historically had the highest mvpfs on average exceeding 5 many such policies have paid for themselves as governments recouped the cost of their initial expenditures through additional taxes collected and reduced transfers we find large mvpfs for education and health policies amongst children of all ages rather than observing diminishing marginal returns throughout childhood we find smaller mvpfs for policies targeting adults generally between 0 5 and 2 expenditures on adults have exceeded this mvpf range in particular if they induced large spillovers on children we relate our estimates to existing theories of optimal government policy and we discuss how the mvpf provides lessons for the design of future research

perceptions of institutional quality evidence of limited attention to higher education rankings abstract rankings of colleges and universities provide information about quality and potentially affect where prospective students send applications for admission we find evidence of limited attention to the popular u s news and world report rankings of america s best colleges we estimate that applications discontinuously drop by 2 6 when the rank moves from inside the top 50 to outside the top 50 whereas there is no evidence of a corresponding discontinuous drop in institutional quality notably the ranking of 50 corresponds to the first page cutoff of the printed u s news guides the choice of college is typically a one time decision with potentially large repercussions so students limited attention to rankings likely represents an irrational bias that negatively affects welfare

student loans do college students borrow too much or not enough total student loan debt rose to over 800 billion in june 2010 overtaking total credit card debt outstanding for the first time by the time this article sees print the continually updated student loan debt clock will show an accumulated total of roughly 1 trillion borrowing to finance educational expenditures has been increasing more than quadrupling in real dollars since the early 1990s the sheer magnitude of these figures has led to increased public commentary on the level of student borrowing the authors move the discussion of student loans away from anecdote by establishing a framework for considering the use of student loans in the optimal financing of collegiate investments from a financial perspective enrolling in college is equivalent to signing up for a lottery with large expected gains indeed the figures presented here suggest that college is on average a better investment today than it was a generation ago but it is also a lottery with significant probabilities of both larger positive and smaller or even negative returns the authors look to available albeit limited evidence to assess which types of students are likely to be borrowing too much or too little

a problem with the negative income tax abstract the goal of a negative income tax is to increase the work incentives of welfare recipients this note points out that it may not do so and empirical simulations show that this is a real world possibility

coordinated admissions program in the wake of challenges to affirmative action access to oversubscribed elite public universities remains a contentious issue much of the research on these issues focuses on freshman admissions this paper examines the university of texas at austin s coordinated admissions program which offers texas residents that were not admitted to the university of texas at austin as freshman the option of transferring from a participating university of texas system school using the regression discontinuity design i show that this path to an elite public university has an impact on academic outcomes

college choice and subsequent earnings results using swedish sibling data college choice and subsequent earnings results using swedish sibling data this paper investigates the relationship between college choice and annual earnings using within family variation in college choice the results show that earnings vary significantly between students who graduated from different types of colleges and the earnings premium is larger for those who graduated at an old university do birth order and family size matter for intergenerational income mobility evidence from sweden previous studies of intergenerational income mobility have not considered potential birth order or family size effects in the estimated income elasticity this paper estimates the intergenerational income elasticity by birth order position and family size the main finding of this paper is that the elasticity tends to decrease with birth order for a given family size especially for fathers and sons a comparison of family and neighborhood effects on grades test scores educational attainment and income evidence from sweden this paper compares sibling and neighborhood correlations in school performance educational attainment and income as a way to learn whether the neighborhood where a child grows up in might explain parts of the sibling similarities found in previous sibling correlation studies the results show that living in the same neighborhood does not seem to add much to the sibling similarity what more than parental income an exploration of what swedish siblings get from their parents in this paper we explore what factors other that parental income can explain why siblings tend to have such similar outcomes as previous correlation studies show our results show that parental involvement and attitudes especially propensity to plan ahead and willingness to postpone benefits to the future are particularly important for the sibling similarity

college choice and wages estimates using data on female twins the authors assess the impact of college quality on women s earnings and the influence of family and individual endowments on college choice using new data from a survey of identical and nonidentical twins born in minnesota the estimates reject models that ignore school choice the statistically preferred estimates suggest that ph d granting private universities with well paid senior faculty and smaller enrollments produce students who have significantly higher earnings later in life both the quantity of schooling and the quality of schooling resources are allocated to higher endowed individuals which exacerbates preexisting inequality in human capital and biases conventional estimates of school quality effects copyright 1996 by mit press

marriage and divorce informational constraints and private contracting the relationship between divorce rates in the united states and laws regulating divorce are analyzed using data from a special current population survey undertaken in 1979 with particular reference to the adoption by many states of no fault divorce laws the author utilizes a contract theoretic framework to examine the impact of both legal and informational constraints on several aspects of the marriage relationship 1 the probability of divorce 2 compensation at divorce i e the terms of the divorce settlement 3 the probability of entering marriage and 4 incentives for investment in marriage specific capital two different models are developed the first assumes that ex post information about the value of each spouses opportunites at divorce is symmetric and that since divorce would only occur if the joint benefits outweigh the joint costs the law has no effect on the divorce rate the second model asserts that the existence of asymmetric information results in a fixed wage marriage contract and that divorce would be higher in states that allow unilateral divorce the evidence supports the first of these hypotheses excerpt

imf supported stabilization programs and their critics evidence from the recent experience of egypt abstract the imf supported stabilization and structural adjustment programs implemented by egypt in the 1990s were successful in meeting their objectives and when compared with earlier attempts and the experience of other developing countries the authorities undertook a sharp reduction in the government s overall deficit and its central bank financing allowing for increased credit availability to the private sector within a framework of a rapidly decelerating monetary expansion despite initiating comprehensive market reforms that significantly improved the environment for private investment the response of the private sector has been disappointing it is argued that until institutional regulatory and political constraints are removed egypt will not join the group of high investing and fast growing economies

affirmative action and the quality fit trade off this paper reviews the literature on affirmative action in undergraduate education and law schools focusing especially on the trade off between institutional quality and the fit between a school and a student we discuss the conditions under which affirmative action for underrepresented minorities urm could help or harm their educational outcomes we provide descriptive evidence on the extent of affirmative action in law schools as well as a critical review of the contentious literature on how affirmative action affects urm law school student performance our review then discusses affirmative action in undergraduate admissions focusing on the effects such admissions preferences have on college quality graduation rates college major and earnings we conclude by examining the evidence on percent plans as a replacement for affirmative action

more cops less crime abstract i exploit a natural experiment to estimate the causal effect of police on crime the american recovery and reinvestment act increased funding for the community oriented policing services cops hiring grant program from less than 20 million over 2005 2008 to 1 billion in 2009 hiring grants distributed in 2009 were allocated according to an application score cutoff rule and i leverage quasi random variation in grant receipt by comparing the change over time in police and crimes for cities above and below the threshold in a difference in differences framework relative to low scoring cities those above the cutoff experience increases in police of about 3 2 and declines in victimization cost weighted crime of about 3 5 following the distribution of hiring grants the effects are driven by large and statistically significant effects of police on robbery larceny and auto theft with suggestive evidence that police reduce murders as well crime reductions associated with additional police were more pronounced in areas most affected by the great recession the results highlight that fiscal support to local governments for crime prevention may offer large returns especially during bad macroeconomic times

not whether but where pell grants and college choices abstract pell grants are the largest financial aid vehicle in the united states and yet their role in shaping students college choices is not clear drawing on the enrollment decisions of four cohorts of tennessee high school graduates and quasi experimental pell eligibility derived from federal formulas we find little evidence that marginal pell eligibility affects whether or where students enroll in college inframarginal estimates suggest that students sort into colleges with 11 6 cents higher tuition per dollar of pell aid although other measures of college quality do not significantly improve over the counterfactual an investigation into mechanisms that might be muting student responses to pell favors the application process itself over grant size or institutional aid flexibility

income segregation and intergenerational mobility across colleges in the united states we construct publicly available statistics on parents incomes and students earnings outcomes for each college in the united states using deidentified data from tax records these statistics reveal that the degree of parental income segregation across colleges is very high similar to that across neighborhoods differences in postcollege earnings between children from low and high income families are much smaller among students who attend the same college than across colleges colleges with the best earnings outcomes predominantly enroll students from high income families although a few mid tier public colleges have both low parent income levels and high student earnings linking these income data to sat and act scores we simulate how changes in the allocation of students to colleges affect segregation and intergenerational mobility equalizing application admission and matriculation rates across parental income groups conditional on test scores would reduce segregation substantially primarily by increasing the representation of middle class students at more selective colleges however it would have little effect on the fraction of low income students at elite private colleges because there are relatively few students from low income families with sufficiently high sat act scores differences in parental income distributions across colleges could be eliminated by giving low and middle income students a sliding scale preference in the application and admissions process similar to that implicitly given to legacy students at elite private colleges assuming that 80 of observational differences in students earnings conditional on test scores race and parental income are due to colleges causal effects a strong assumption but one consistent with prior work such changes could reduce intergenerational income persistence among college students by about 25 we conclude that changing how students are allocated to colleges could substantially reduce segregation and increase intergenerational mobility even without changing colleges educational programs

born under a lucky star financial aid college completion labor supply and credit constraints financial aid can affect both college enrollment and graduation the effects on graduation can be driven by students being induced to enroll by financial aid students who would have enrolled anyway graduating as a result of the financial aid or both this study isolates the effect of financial aid on the second group by examining a change in aid that did not change enrollment i study a discontinuous change in the amount of aid available to students who meet the age cutoff for financial independence i find that additional aid causes some university seniors to graduate one year earlier abstract from author

from the editors endogeneity in international business research this essay builds on the exposition by thomas et al and focuses on analyzing cause and effect in international business research we attempt to explain how endogeneity problems occur and why they are so prevalent in international business research in a non technical fashion we then discuss the importance of explicitly identifying how the chosen research design best approximates a randomized controlled experiment finally we provide some guidelines on achieving this goal and emphasize the practices that seem most relevant to jibs reviewers in evaluating high quality international business research

field of study earnings and self selection why do individuals choose different types of post secondary education and what are the labor market consequences of those choices we show that answering these questions is difficult because individuals choose between several unordered alternatives even with a valid instrument for every type of education instrumental variables estimation of the payoffs require information about individuals ranking of education types or strong additional assumptions like constant effects or restrictive preferences these identification results motivate and guide our empirical analysis of the choice of and payoff to field of study our context is norway s post secondary education system where a centralized admission process covers almost all universities and colleges this process creates credible instruments from discontinuities which effectively randomize applicants near unpredictable admission cutoffs into different fields of study at the same time it provides us with strategy proof measures of individuals ranking of fields taken together this allows us to estimate the payoffs to different fields while correcting for selection bias and keeping the next best alternatives as measured at the time of application fixed we find that different fields have widely different payoffs even after accounting for institutional differences and quality of peer groups for many fields the payoffs rival the college wage premiums suggesting the choice of field is potentially as important as the decision to enroll in college the estimated payoffs are consistent with individuals choosing fields in which they have comparative advantage we also test and reject assumptions of constant effects or restrictive preferences suggesting that information on next best alternatives is essential to identify payoffs to field of study