Abramitzky, Ran and Lavy, Victor (2011) How responsive is investment in schooling to changes in redistribution policies and in returns. Working Paper. The National Bureau of Economic Research, Cambridge, MA. (Unpublished)

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Abstract

This paper uses an unusual pay reform to test the responsiveness of investment in schooling to changes in redistribution schemes that increase the rate of return to education. We exploit an episode where different Israeli kibbutzim shifted from equal sharing to productivity-based wages in different years and find that students in kibbutzim that reformed earlier invested more in education. This effect is stronger for males and is mainly driven by students whose parents have lower levels of education. Our findings support the prediction that education is highly responsive to changes in the redistribution policy, especially for students from weaker backgrounds.

Item Type:	Working or Discussion Paper (Working Paper)
Subjects:	H Social Sciences > HB Economic Theory J Political Science > JC Political theory L Education > L Education (General)
Divisions:	Faculty of Social Sciences > Economics
Series Name:	NBER Working Papers
Publisher:	The National Bureau of Economic Research
Place of Publication:	Cambridge, MA
Date:	May 2011
Number:	No.17093
Number of Pages:	57
Status:	Not Peer Reviewed
Publication Status:	Unpublished
Access rights to Published version:	Open Access
Related URLs:	Publisher
URI:	http://wrap.warwick.ac.uk/id/eprint/45558

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