Widening Participation in Higher Education

New IZA working paper on this topic:

Widening Participation in Higher Education: Analysis Using Linked Administrative Data

Authors: Haroon Chowdry, Claire Crawford, Lorraine Dearden, Alissa Goodman, Anna Vignoles

Abstract:
This paper makes use of newly linked administrative data to better understand the determinants of higher education participation amongst individuals from socio-economically disadvantaged backgrounds. It is unique in being able to follow two cohorts of students in England – those who took GCSEs in 2001-02 and 2002-03 – from age 11 to age 20. The findings suggest that while there remain large raw gaps in HE participation (and participation at high-status universities) by socio-economic status, these differences are substantially reduced once controls for prior attainment are included. Moreover, these findings hold for both state and private school students. This suggests that poor attainment in secondary schools is more important in explaining lower HE participation rates amongst students from disadvantaged backgrounds than barriers arising at the point of entry into HE. These findings highlight the need for earlier policy intervention to raise HE participation rates amongst disadvantaged youth.

http://ftp.iza.org/dp4991.pdf

Cunha, Heckman and Schennach - Estimating the Technology of Human Skill Formation - IZA

Estimating the Technology of Cognitive and Noncognitive Skill Formation
 by Flavio Cunha, James J. Heckman, Susanne Schennach
(January 2010)

Abstract:
This paper formulates and estimates multistage production functions for children's cognitive and noncognitive skills. Skills are determined by parental environments and investments at different stages of childhood. We estimate the elasticity of substitution between investments in one period and stocks of skills in that period to assess the benefits of early investment in children compared to later remediation. We establish nonparametric identification of a general class of production technologies based on nonlinear factor models with endogenous inputs. A by-product of our approach is a framework for evaluating childhood and schooling interventions that does not rely on arbitrarily scaled test scores as outputs and recognizes the differential effects of the same bundle of skills in different tasks. Using the estimated technology, we determine optimal targeting of interventions to children with different parental and personal birth endowments. Substitutability decreases in later stages of the life cycle in the production of cognitive skills. It increases slightly in later stages of the life cycle in the production of noncognitive skills. This finding has important implications for the design of policies that target the disadvantaged. For some configurations of disadvantage and for some outcomes, it is optimal to invest relatively more in the later stages of childhood than in earlier stages. 

Heckman and Jacobs on Policies that Create and Destroy Human Capital - IZA Paper

Policies to Create and Destroy Human Capital in Europe 
by James J. Heckman, Bas Jacobs
(December 2009)
forthcoming in: Hans-Werner Sinn and Edmund Phelps (eds.), Perspectives on the Performance of the Continent's Economies, MIT Press

Abstract:
Trends in skill bias and greater turbulence in modern labor markets put wages and employment prospects of unskilled workers under pressure. Weak incentives to utilize and maintain skills over the life-cycle become manifest with the ageing of the population. Reinvention of human capital policies is required to avoid increasing welfare state dependency among the unskilled and to reduce inefficiencies in human capital formation. Policy makers should acknowledge strong dynamic complementarities in skill formation. Investments in the human capital of children should expand relative to investment in older workers. There is no trade-off between equity and efficiency at early ages of human development but there is a substantial trade-off at later ages. Later remediation of skill deficits acquired in early years is often ineffective. Active labor market and training policies should therefore be reformulated. Skill formation is impaired when the returns to skill formation are low due to low skill use and insufficient skill maintenance later on in life. High marginal tax rates and generous benefit systems reduce labor force participation rates and hours worked and thereby lower the utilization rate of human capital. Tax-benefit systems should be reconsidered as they increasingly redistribute resources from outsiders to insiders in labor markets which is both distortionary and inequitable. Early retirement and pension schemes should be made actuarially fairer as they entail strong incentives to retire early and human capital is thus written off too quickly.