Permanent Income and the Black-White Test Score Gap

Jesse Rothstein and Nathan Wozny

No 17610, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Analysts often examine the black-white test score gap conditional on family income. Typically only a current income measure is available. We argue that the gap conditional on permanent income is of greater interest, and we describe a method for identifying this gap using an auxiliary data set to estimate the relationship between current and permanent income. Current income explains only about half as much of the black-white test score gap as does permanent income, and the remaining gap in math achievement among families with the same permanent income is only 0.2 to 0.3 standard deviations in two commonly used data sets. When we add permanent income to the controls used by Fryer and Levitt (2006), the unexplained gap in 3rd grade shrinks below 0.15 standard deviations, less than half of what is found with their controls.

JEL-codes: I21 I24 J15 (search for similar items in EconPapers)
Date: 2011-11
New Economics Papers: this item is included in nep-ure
Note: CH ED
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Citations: View citations in EconPapers (4)

Published as Jesse Rothstein & Nathan Wozny, 2013. "Permanent Income and the Black-White Test Score Gap," Journal of Human Resources, University of Wisconsin Press, vol. 48(3), pages 510-544.

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Related works:
Working Paper: Permanent Income and the Black-White Test Score Gap (2011)
Working Paper: Permanent Income and the Black-White Test Score Gap (2011)
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