Schooling and Labor Market Consequences of School Construction in Indonesia: Comment

David Roodman

No 15, I4R Discussion Paper Series from The Institute for Replication (I4R)

Abstract: Duflo (2001) exploits a 1970s schooling expansion in Indonesia to estimate the returns to schooling. Under the study's difference-in-differences (DID) design, two patterns in the data-shallower pay scales for younger workers and negative selection in treatment-can violate the parallel trends assumption and upward-bias results. In response, I follow up later, test for trend breaks timed to the intervention, and perform changes-in-changes (CIC). I also correct data errors, cluster variance estimates, incorporate survey weights to correct for en-dogenous sampling, and test for (and detect) instrument weakness. Weak identification-robust inference yields imprecise, positive estimates. CIC estimates tilt slightly negative.

Keywords: education; wages; reanalysis (search for similar items in EconPapers)
JEL-codes: I2 J31 O15 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-lma, nep-sea and nep-ure
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https://www.econstor.eu/bitstream/10419/268346/1/I4R-DP015.pdf (application/pdf)

Related works:
Working Paper: Schooling and Labor Market Consequences of School Construction in Indonesia: Comment (2025)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:i4rdps:15

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