Family and school influences in the determination of child outcomes: Evidence from two sources of variation

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In analyses of human capital, a classic issue concerns to what extent outcomes for children are influenced by their school vs. their home environment. On the one hand, it may be that outcomes are fully determined at home, and that good schools are little more than clubs for good children. On the other, schools may really produce value added, for example, by providing students with good teachers or peers. Additionally, assuming parents do think schools have an effect, a recurring question concerns whether they view school quality and their own effort as substitutes? Parents whose children are admitted into a good school may react to this by increasing or reducing their own effort. Solid evidence on these issues has been difficult to produce, mainly because children are not randomly allocated to schools, let alone to family environments. This study would address this challenge by analyzing a setting that provides two independent sources of arguably exogenous variation in the school and home environments that children experience. Specifically, it would study Romanian children born between 1989 and 1990, a group which faced two analytically useful circumstances. First, these students transitioned into secondary education at a time when children were allocated to high schools via a centralized system under which admissions substantially depended on performance in a national (middle school to high school) transition exam. This yields situations in which students with very similar transition scores end up in schools of substantially different quality. Second, the births of these cohorts chronologically contain the lifting of the stringent Romanian ban on abortion and birth control. Following this change, birth rates decreased abruptly by 30 percent, implying that prior to it, about one third of children were unwanted and therefore born into adverse family environments. The study would use these two sources of variation to implement a regression discontinuity and a simple difference estimation strategy. These two strategies would be applied to data from (existing) administrative sources and a (proposed) survey, addressing the following questions: 1) Does attending a more selective school affect students cognitive and behavioral outcomes? 2) What are some of the mechanisms that mediate such effects? 3) How does unwantedness at birth affect educational and behavioral outcomes? 4) What are the mechanisms behind these effects? 5) How do family environment (due to being an unwanted/wanted child) and school environment (due to attending more/less selective school) interact to shape the outcomes for children? Broader impact: The findings of this project on how family and school shape child outcomes will be policy relevant in both developing and developed countries. The findings would be disseminated via Economics and Education journals and seminars, as well as through direct contacts with agencies like the World Bank and multiple ministries of education. Additionally, our data, which we plan to make public after our initial analysis, would be useful to the broader research community. In particular, its mix of cognitive and non-cognitive outcomes would allow for meaningful cross-disciplinary work covering education, economics and sociology. Finally, the creation of a baseline survey sample with detailed geographic information would allow to track and study the longer term socioeconomic outcomes of students.