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University tuition fees for undergraduates were abolished in Ireland in 1996. This paper examines the effect of this reform on the socio-economic gradient to determine whether the reform was successful in achieving its objective of promoting educational equality that is improving the chances of low socio-economic status (SES) students progressing to university. It finds that the reform clearly did not have that effect. It is also shown that the university/SES gradient can be explained by differential performance at second level. Students from white collar backgrounds do significantly better in their final second level exams than the children of blue-collar workers. The results are very similar to recent findings for the UK. The results show that the effect of SES on school performance is generally stronger for those at the lower end of the conditional distribution of academic attainment.

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This paper uses the measures of basic skills (or functional literacy) in the International Adult Literacy Survey to examine the impact of education and basic skills on earnings across a large number of countries. We show that the estimated return to formal education is sensitive to the inclusion of these measures: excluding them biases the return to education upwards in many countries to a significant degree, usually one or two percentage points. In almost all countries, the test scores have a well-determined effect on earnings although there is considerable variation in the size of the effect. The highest returns to skills tend to be in English speaking countries. Comparing results across countries, the returns to education and the returns to basic skills are not correlated. The evidence suggests that there is considerable benefit in many countries for policy intervention to increase the skill levels of workers. This should not just be directed at dealing with low-skilled individuals - there are gains across the skills distribution.

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The New Deal For Young People is the major welfare-to-work program in the UK. It is a mandatory multistage policy targeted at the 18-24 year old unemployed. This paper investigates the effectiveness of the program in terms of enhancing the (re)employment probability of participant males. I exploit the eligibility rule to identify a suitable counterfactual relying upon a simple regression discontinuity design. By exploiting such a discontinuity I am able to non-parametrically identify (Hahn et al., 2001) a local average treatment effect (LATE). While relying upon the non-parametric local linear regression method I am able to push forward such a parameter to a 'global' dimension, implicitly adding parametric structure. No evidence of possible general equilibrium as well as substitution effects is found by a cohort specific approach (before and after the program). The main result is that the program enhances employability by about 6-7 per cent.

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This paper analyses the career progression of skilled and unskilled workers with a focus on how careers are affected by economic downturns and whether formal skills, acquired early on, can shield workers from the effect of recessions. Using detailed administrative data for Germany for numerous birth cohorts across different regions, [the authors] follow workers from labour market entry onwards and estimate a dynamic life-cycle model of vocational training choice, labour supply, and wage progression. Most particularly, [this] model allows for labour market frictions that vary by skill group and over the business cycle. [The authors] find that sources of wage growth differ: learning-by-doing is an important component for unskilled workers early on in their careers, while job mobility is important for workers who acquire skills in an apprenticeship scheme before labour market entry. Likewise, economic downturns affect skill groups through very different channels: unskilled workers lose out from a decline in productivity and human capital, whereas skilled individuals suffer mainly from lack of mobility.

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This paper examines the impact of month of birth on national achievement test scores in England whilst children are in school, and on subsequent further and higher education participation. Using geographical variation in school admissions policies, we are able to split this difference into an age of starting school or length of schooling effect, and an age of sitting the test effect. We find that the month in which you are born matters for test scores at ages seven, 11, 14 and 16, with younger children performing significantly worse, on average, than their older peers. Furthermore, almost all of this difference is due to the fact that younger children sit exams up to one year earlier than older cohort members. The difference in test scores at age 16 potentially affects the number of pupils who stay on beyond compulsory schooling, with predictable labour market consequences. Indeed, we find that the impact of month of birth persists into higher education (college) decisions, with age 19/20 participation declining monotonically with month of birth. The fact that being young in your school year affects outcomes after the completion of compulsory schooling points to the need for urgent policy reform, to ensure that future cohorts of children are not adversely affected by the month of birth lottery inherent in the English education system.

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We model the choice of individuals to follow or not apprenticeship training and their subsequent career. We use German administrative data, which records education, labour market transitions and wages to estimate a dynamic discrete choice model of training choice, employment and wage growth. The model allows for returns to experience and tenure, match specific effects, job mobility and search frictions. We show how apprenticeship training affects labour market careers and we quantify its benefits, relative to the overall costs. We then use our model to show how two welfare reforms change life-cycle decisions and human capital accumulation: one is the introduction of an Earned Income Tax Credit in Germany, and the other is a reform to Unemployment Insurance. In both reforms we find very significant impacts of the policy on training choices and on the value of realized matches, demonstrating the importance of considering such longer term implications.

An earlier version of this paper is indexed at TD/TNC 87.523.

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There is a growing concern in advanced countries that the position of less skilled workers has deteriorated, either through their ability to secure jobs and/or their ability to earn a decent wage. Some have linked this decline to modern computing technologies. This paper surveys the evidence on the effects of technical change on skills, wages and employment by examining the micro-econometric evidence (we take this to include studies at the industry, firm, plant and individual levels). We focus on over 70 empirical studies that have used direct measures of technology (rather than associating technology with a residual time trend). We first point to three basic methodological problems relating to endogeneity, fixed effects and measurement. Our survey comes to the following tentative conclusions: (i) there is a strong effect of technology on skills in the cross section which appears reasonably robust to various econometric problems; (ii) there is a strong effect of diffusion of technologies on wages in the cross section which is not robust to endogeneity and fixed effects; (iii) at the firm level product innovations appear to raise employment growth, but there is no clear evidence of a robust effect (either positive or negative) of process innovations or R&D [research & development] on jobs.

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Education is often regarded as a route to social mobility. For this to be the case, however, the link between family background and adult outcomes must be broken (or at least reduced) once account is taken of an individual's education history. This paper focuses on individuals who have completed university and provides new evidence on differences in graduates' earnings by socioeconomic background, with a particular focus on whether they attended a private school. [The authors] use data on the population of individuals graduating from UK universities in 2006-07 and find that those who attended private schools earn around seven per cent more per year, on average, than state school students some 3.5 years after graduation, even when comparing otherwise similar graduates and allowing for differences in degree subject, university attended and degree classification. This work complements Macmillan et al. (2013), who found that graduates from private schools were more likely to enter 'high status' occupations. However, [the authors'] results show that earnings differences persist even within occupations, with graduates who attended private schools earning six per cent more than their state school compatriots working in the same occupations. This is equivalent to around £1,500 extra per year in [the authors'] data. Together, these results suggest that there is a pressing need to understand why private schooling confers such an advantage in the labour market, even amongst similarly achieving graduates, and why higher education does not appear to be the leveller it was hoped to be.

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In China, the employment rate among middle-aged and older urban residents is exceptionally low. For example, 27 per cent of 55-64 year old urban women were in work in 2013, compared to more than 50 per cent in UK, Thailand and Philippines. This paper investigates potential explanations of this low level of employment in urban China. [The author documents] the stylized fact that a majority of individuals stop working as soon as they qualify for a public pension, which most often happens at age 50 for women. [The author also highlights] the presence of significant amounts of financial and time transfers between generations. [The author provides] descriptive evidence that transfers from children are responsive to parental incomes, and that mother's labour supply is affected by the expectation of transfers from her children. [The author then built] and calibrated a life-cycle model of labour supply and saving. [The author finds] that both the pension system and transfers from children have large effects on female labour supply. Increasing the female pension age from the status-quo to 60 would raise the employment rate of 50-59 year old women by 28 percentage points.

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This paper reviews some of the econometric methods that have been used in the economics of education. The focus is on understanding how the assumptions made to justify and implement such methods relate to the underlying economic model and the interpretation of the results. We start by considering the estimation of the returns to education both within the context of a dynamic discrete choice model inspired by Willis and Rosen (1979) and in the context of the Mincer model. We discuss the relationship between the econometric assumptions and economic behaviour. We then discuss methods that have been used in the context of assessing the impact of education quality, the teacher contribution to pupils’ achievement and the effect of school quality on housing prices. In the process we also provide a summary of some of the main results in this literature.

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