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Economics of Education

Lightning Round Session

Saturday, Jan. 4, 2025 8:00 AM - 10:00 AM (PST)

Parc 55, Hearst
Hosted By: American Economic Association
  • Chair: Christopher Walters, University of California-Berkeley

Buy In, Opt Out? The Effect of the School Choice Lottery on Parental Educational Spending and Investment Decision: Evidence from a Quasi-Experiment in China

Guodong Chen
,
New York University-Shanghai
Yu Zhou
,
New York University-Shanghai
Cheng Jiang
,
Peking University
Jianye Yan
,
China Agricultural University

Abstract

Over-subscription in the school choices is common in developing countries. As
a result, the school choice lottery has become a popular tool to solve the oversubscription
issues. Using a unique user level data from a large mobile platform, we examine the impact of the school choice lottery on the parental educational spending and other consumption and investment decision at China. Our results show that parents respond to the reform significantly after the announcement of the policy. In addition, we find that there exists a large heterogeneity across the gender and migrant history as well as their consumption level. Furthermore, we explore the potential source to finance the increase in educational spending and find that users with low to medium wealth will crowd out the general merchandise spending, but the users with high wealth level will cash out their mutual fund investment. Our results imply that there exists a large magnitude of undocumented noncompliance, which could potentially bias the intended policy effect.

When The Student Becomes the Master: A Field Experiment on Learning by Teaching

Rohen Shah
,
University of Chicago

Abstract

Learning by Doing (Arrow, 1962) is a longstanding theory on skill development, but it is unclear what the "doing" might be for students learning an academic subject. In this paper, I propose that for students, the "doing" of learning is actually teaching. This study presents evidence from a large-scale field experiment that randomly assigned students to experimental conditions in which they are either (1) assigned to make ``explanation'' videos, (2) assigned additional practice problems, or (3) placed in a pure control condition. The explanation treatment improved short-run scores by 0.17 standard deviations and long-run grades by 0.07 standard deviations relative to the practice-problem group. Notably, while both treatment groups improved relative to control, only the explanation treatment improved performance on novel problems, suggesting that explaining concepts enhances one's ability to understand deeply and generalize concepts.

How Early Career Choices Adjust to Economic Crises

Julien Grenet
,
Paris School of Economics
Hans Gronqvist
,
Linnaeus University
Edvin Hertegård
,
Stockholm University
Martin Nybom
,
Uppsala University
Jan Stuhler
,
Carlos III University of Madrid

Abstract

Economic crises are large adverse shocks to the economy with the potential to reshape labor markets. These events often disproportionately affect some groups of workers. Recent studies highlight the persistent nature of such labor-market scars. Less is known, however, about the behavioral responses to these events, especially among the next generation of workers on the verge of choosing their career paths. Young workers may suffer from information frictions and a lack of networks to effectively navigate the career and job search process. Such frictions could be especially important in turbulent times when uncertainty about labor market conditions increases. We study how students adjust their early career choices in response to economic crises, and how this behavioral response affects their long-run labor market outcomes. We specifically examine the context of the severe recession that struck Sweden in the early 1990s, which disproportionally affected the manufacturing and construction sectors. Our novel empirical strategy addresses correlated unobservables by leveraging the distinctive timing of high school program choices in Sweden, which are typically made when students turn 16, in conjunction with the timing of paternal job loss in heavily affected sectors. As we partial out mechanisms related to paternal job loss in general (e.g. household resource loss or direct effects on compulsory school grades), we interpret our treatment as an information signal stemming from paternal job loss in the crisis-affected sectors. We find that students who experienced paternal job loss in heavily affected sectors were more likely to choose high school programs linked to sectors less impacted by the recession. As a result, these individuals achieved better labor market outcomes in adulthood. Our findings are consistent with informational frictions being a key obstacle to structural change, and we identify career choice as an important mechanism through which recessions reshape labor markets in the long-run.

Inspirational or Demotivational: Experimental Evidence on the Impacts of Role Models

Aurelia Aochun Di
,
University of Washington

Abstract

Role models with outstanding accomplishments can inspire, yet if perceived as too successful, they might render goals unattainable and minimally influence their role aspirants. Utilizing a randomized controlled trial with Chinese students, this paper contrasts the impacts of “very successful” versus “moderately successful” role models. Comparably, the very successful role models challenge pervasive beliefs about student gender and ability, inspiring girls to believe in their abilities and enhancing their math test scores. Yet, the very successful role models fail to care for students’ subjective well-being and demotivate low-performing boys from aspiring for opportunities beyond their hometown. This paper highlights a trade-off between goal attainability and desirability caused by role models’ level of success. The extent to which students gain from this trade-off differs, based on student gender and ability.

Not Too Early, Not Too Late: Encouraging Engagement in Education

Tracy Xiao Liu
,
Tsinghua University
Ulrike Malmendier
,
University of California-Berkeley
Stephanie Wang
,
University of Pittsburgh
Shuhuai Zhang
,
Tsinghua University

Abstract

A common reason why individuals fail to reach educational and other longterm goals is that it is hard to maintain the required effort over time. One example is the decline in attendance and student engagement over the course of a semester. While educators often attempt to address these issues with information and motivational material at the beginning of a class, or with remedial sessions at the end of the class, we argue that the critical time in longterm sustained efforts falls instead in the middle. To study the effect of timing, we conduct a field experiment that assigns a task aimed at engaging stude nts with the class material at different times throughout the semester. We show that assigning tasks to low-performing students in the middle of the term, compared to early or late in the semester, improves their performance along several dimensions: attendance, homework grades, and exam grades. Consistent with our theoretical framework, our findings suggest that accumulating frictions over the course of a semester and the corresponding decline in effort can be addressed by an intermediate timing of costly "engagement'’ tasks.

Overconfidence and Inaccurate Self-Assessment: Evidence from Student Grade Estimations

Huan Cai
,
Cornell College
Jie Zheng
,
Shandong University

Abstract

We conduct a series of surveys in the 12th grade of a senior-high school in China for a cohort of around 1,800 students who took the annual National College Entrance Exam (also known as Gaokao) in July of the years 2022 and 2023. Students were asked to fill in multiple surveys for five sets of mock exams and Gaokao: one before each exam, and the other after the exam but before the exam results are revealed.

Using over 1,300 students’ self-reported estimations of their exam performance on six different subjects, we find stronger effects of overplacement (of their ranks) than overestimation (of exam scores) for the same task, following the definitions of overconfidence in Moore and Healy (2008).

In estimates of the current task (of mock exams), we also confirm the Dunning-Kruger effects that students who are more competent in a subject are less likely to overestimate or overplace their performances. Such Dunning-Kruger effects are stronger for overplacement than those for overestimation, and are more profound in the before-exam surveys than those in the after-exam ones. However, the same analyses in estimates of a future task (of Gaokao) present mixed results.

To further understand these new findings, we decompose the traditional overconfidence measures into two separate perspectives: biased estimates (measured by the signs of the estimation errors), and inaccurate self-assessments (measured by the absolute value of the estimation errors). We show that, in estimates of the current task, both perspectives contribute to the Dunning-Kruger effects: students who are more competent in a subject are less likely to overestimate (or overplace) their performances and have more accurate self-assessments. While taking the survey after the exam does not significantly change the biased estimates effects, it does help reduce the gap in self-assessment accuracy between students with different competency.

The Effect of Losing Pell Grant Eligibility on Student Outcomes

Shinyoung Kim
,
Iowa State University

Abstract

This paper examines the effects of Pell Grant eligibility on student outcomes using a regression discontinuity (RD) design and bounds treatment effects to account for selection effects arising from the loss of Pell Grant eligibility- a question unexplored in previous research. While initial eligibility is determined by financial need, students must achieve Satisfactory Academic Progress (SAP) to retain the grant. The findings show that students who initially received more grant aid are 26 percentage points less likely to persist in the year they lose Pell and 8 percentage points less likely to graduate within 4 years compared to those with less aid. Moreover, those who did not persist had significantly lower SAT math scores, suggesting that non-persistence is not random; thus, the RD estimand is confounded by selection effects. Finally, I estimate bounds on the treatment effects, accounting for selection effects. The bounding results suggest that the previously estimated effects of additional grants on student outcomes may be underestimated. For example, while naive RD estimates find no effect on 4-year graduation rates, accounting for selection effects reveals that students receiving additional grant aid are 7 percentage points more likely to graduate within 4 years compared to those with less aid. One may argue that the SAP policy enhances aid efficiency by pushing out students whose costs of finishing college exceed the benefits; however, evidence suggests that it also dismisses students who may be capable of completing and potentially benefiting from college.

The Effects of Additional High School STEM Exposure on Academic and Non-academic Outcomes

Robert Ainsworth
,
University of Florida
Rajeev Dehejia
,
New York University
Andrei Munteanu
,
University of Quebec-Montreal
Cristian Pop-Eleches
,
Columbia University
Miguel Urquiola
,
Columbia University

Abstract

This study evaluates the impacts of being assigned to a STEM- versus humanities-focused high school curriculum. We use a regression discontinuity design, exploiting admissions cutoffs generated by a centralized assignment system in the country of Romania. We obtain outcomes using both administrative data and large-scale surveys. We examine effects on test scores, college-going, expectations, non-cognitive outcomes, and social and economic preferences. We find that being assigned to STEM causes students to think they are better at STEM, to like STEM more, and to be much more likely to study STEM in college. In addition, it does not appear to adversely affect wellbeing or social connections. Effects are similar by gender and by initial curricular preferences, suggesting that additional high school exposure to STEM may have widespread benefits.

To Inspire and To Inform: The Role of Role Models

Marcos Agurto
,
University of Piura
Muchin Isabel Ayen Bazan Ruiz
,
Georgia Institute of Technology
Siddharth Hari
,
World Bank
Sudipta Sarangi
,
Virginia Tech

Abstract

Bridging the gender gap in STEM fields has emerged as a concern for policymakers both in developed and developing countries. This paper examines the impact of light touch intervention where female engineering students act as role-models for high school students in Peru. We find that a brief 20-minute interaction with the role-models led to sharp increases in preferences towards engineering, with the effects being concentrated on female students with high math aptitude. We find that these results are driven by increased self-confidence as a result of exposure to role models. Set in the context of a developing country, our results show that low-cost interventions can be helpful in reducing the STEM gender gap but cannot address broader deep seated gender stereotypes.

What Is Essential Is Visible to the Eye: Saliency in Primary School Ranking and Its Effect on Academic Achievements

Francois-xavier Ladant
,
Northwestern University and Harvard University
Julien Hédou
,
Stanford University
Paolo Sestito
,
Bank of Italy
Falco Bargagli-Stoffi
,
Harvard University

Abstract

We propose a new strategy to identify the impact of class rank, exploiting a “visible” primary school rank from teachers’ exam grades, and an “invisible” rank from unreported standardized test scores. Leveraging a unique panel dataset on Italian students, we show that the visible rank has a substantial impact on students’ perceptions, which affects subsequent academic performance. However, the effect of being surrounded by higher-SES or higher-achieving peers remains positive even accounting for the decrease in rank. Higher-ranked students self-select into high schools with higher average student achievements. Finally, exploiting an extensive survey, we identify psychological mechanisms channeling the rank effect.
JEL Classifications
  • I2 - Education and Research Institutions