Essays in Economics of Education

This dissertation consists of three separate essays on the economics of education. In the first chapter, co-authored with Esteban Aucejo, studies the relative effectiveness of reducing absences to extending the school calendar on test score performance. Using administrative data for North Carolina public schools, we exploit a state policy that provides variation in the number of days prior to standardized testing and find substantially larger effects for absences relative to additional days of class.

The second chapter, co-authored with Esteban Aucejo, analyzes whether different institutional settings could affect how school administrators and teachers respond to possible extensions of the school calendar. We present a theoretical model in which principals set the date of the test and teachers decide how much effort to exert in the classroom with and without monetary performance bonuses for teachers. Leveraging the removal of monetary bonuses during the sample period, we utilize a difference-in- difference estimation strategy and find that, consistent with the theoretical model, low performing schools are more likely to make extensive use of the testing window when monetary bonuses are in place; this behavior disappears after changes to the scheme of incentives.

In the third chapter, I present joint work with Peter Arcidiacono, V. Joseph Hotz and Arnaud Maurel, utilizing data on subjective expectations of outcomes from counterfactual choices to recover ex ante<\italic> treatment effects as well as the non-pecuniary benefits associated with different treatments. The particular treatments we consider are the choice of occupation. By asking individuals about potential earnings associated with counterfactual choices of college majors and occupations, we can recover the full distribution of ex ante<\italic> monetary returns to particular occupations, and how they vary across majors. We then link subjective expectations to a model of occupational choice, enabling the examination of how individuals tradeoff their preferences for particular occupations with the corresponding monetary rewards. While sorting across occupations is partly driven by the ex ante<\italic> monetary returns, sizable differences in expected earnings across occupations remain after controlling for selection on monetary returns, which points to the existence of substantial compensating differentials.