Family and Gender Still Matter: The Heterogeneity of Returns to Education in Germany


Schnabel, Isabel ; Schnabel, Reinhold


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URL: http://ub-madoc.bib.uni-mannheim.de/378
URN: urn:nbn:de:bsz:180-madoc-3783
Document Type: Working paper
Year of publication: 2002
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: J31 C23 ,
Subject headings (SWD): Geschwister , Analyse , Chancengleichheit / Bildung , Familie
Abstract: Using information on family background, we estimate returns to education, allowing for the heterogeneity of returns. In order to control for the unobserved heterogeneity shared by family members, we construct a siblings sample and employ family fixed-effects and family correlated random-effects models. Our main result is that family background still matters despite the substantial political efforts to equalize educational opportunities in Germany. Persons with less-educated parents earn lower wages, but have higher returns to education. This supports the view that persons from less-educated backgrounds still face higher marginal costs in the educational system. The same interplay between the wage level and marginal returns is found for the effect of gender and cohort.
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Schnabel, Isabel ; Schnabel, Reinhold (2002) Family and Gender Still Matter: The Heterogeneity of Returns to Education in Germany. Open Access [Working paper]
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