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Education policy and intergenerational income mobility: Evidence from the Finnish comprehensive school reform

Sari Pekkala Kerr (), Tuomas Pekkarinen and Roope Uusitalo

No 222, Working Papers from Palkansaajien tutkimuslaitos, Labour Institute for Economic Research

Abstract: This paper estimates the effect of a major education reform on the intergenerational incomemobility in Finland. The Finnish comprehensive school reform of 1972-1977 replaced the old two-trackschool system with a uniform nine-year comprehensive school and significantly reduced thedegree of heterogeneity in the Finnish primary and secondary education. We estimate the effectof this reform on the intergenerational income elasticity using a representative sample of malesborn during 1960-1966. The identification strategy relies on a difference-in-differences approachand exploits the fact that the reform was implemented gradually across country during a six-yearperiod. The results indicate that the reform reduced the intergenerational income elasticity byabout seven percentage points.

Pages: 37 pages
Date: 2006-09-05
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Working Paper: Educational policy and intergenerational income mobility: evidence from the Finnish comprehensive school reform (2006) Downloads
Working Paper: Education Policy and Intergenerational Income Mobility: Evidence from the Finnish Comprehensive School Reform (2006) Downloads
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