Education economics - Economics of Education

ECONOMICS of EDUCATION

Course given by Robert Gary-Bobo

M1

Academic Year 2025-26, first semester

Course outline

1. Introduction. Optimal Allocation of Resources for Education and Economic Justice Criteria.

2. Theory of Human Capital : The Becker-Mincer Model. Classic results.

3. Job Market Signaling. Spence’s. Employer Learning .

4. Econometrics of the Mincer Equation. Endogeneous education in wage equations.

4a. Instrumental Variable estimation.

4b. Self-selection models. Roy’s model. Models with latent types and unobserved  heterogeneity à la Heckman.

5. Classroom Economics 1. The class-size debate.

6. Classroom Economics 2. The value-added of school and teachers. Econometric methods.

7. Discrimination and education: endogenous discrimination and human capital investment. Coate and Loury’s Model.

A few references:

Eric Hanuschek and Finis Welch, editors, (2006), Handbook of the Economics of Education, Elsevier, Amsterdam.

Abdulkadiroglu, Atila, Pathak, Parag, Schellenberg, Jonathan and Christopher Walters (2020), “Do Parents Value School Effectiveness”, American Economic Review, 110(5), 1502-1539.

Coate, Stephen, and Glenn C. Loury (1993), “Will Affirmative-Action Policies Eliminate Negative Stereotypes?”, American Economic Review, 83(5), 1220–1240.

Angrist, Joshua D. and Victor Lavy (1999), “Using Maimonides' Rule to Estimate the Effect of Class Size on Scholastic Achievement”, Quarterly Journal of Economics, 114(2), 533–575.

James J. Heckman, Lance J. Lochner and Petra E. Todd (2006), ``Earnings Functions, Rates of Return and Treatment Effects: The Mincer Equation and Beyond'', chapter 7 in Eric Hanushek and Finnis Welch, editors, Handbook of Economics of Education, volume 1, p 307-458, Elsevier, Amsterdam.

David Card (1999), “The Causal Effect of Education on Earnings”, Chap. 30 in: Orley C. Ashenfelter and David Card, editors, Handbook of Labor Economics, Volume 3, Part A, p. 1801-1863, Elsevier, Amsterdam.