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Teachers, home environment, and human capital formation
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Florence : European University Institute, 2024
EUI; ECO; PhD Thesis
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SIERRA VÁSQUEZ, Sofía Betania, Teachers, home environment, and human capital formation, Florence : European University Institute, 2024, EUI, ECO, PhD Thesis - https://hdl.handle.net/1814/77590
Abstract
This thesis consists three independent essays that answer policy-relevant questions related to various aspects of human capital formation and child and family well-being. All questions are answered using different applied econometrics methods. In the first chapter, joint with Adriano De Falco and Benjamin Hattemer, we analyze the impact of a recruitment policy aimed at improving the quality of new teachers. The reform introduced a scholarship to incentivize the enrollment of high-achieving high school graduates in teacher training programs and imposed enrollment restrictions on low-achieving high school graduates. The screening device used to define achievement was the national standardized university entry exam. Using rich administrative data, we document that the reform was effective in improving the average test scores of new teachers, especially in public schools. To assess the impact of the reform on teacher quality, we construct teacher value-added (TVA) measures based on standardized test scores of their pupils. We find that the reform led to a significant increase in the TVA of mathematics teachers, equivalent to 30% of a standard deviation. However, it did not affect the average TVA of Spanish teachers. We show that this heterogeneity can be explained by differences in the correlation of test scores and teacher quality across subjects. Finally, we show that only one-third of the increase in teacher quality can be explained by the change in ability composition, and the remainder can be attributed to beneficial but unintended effects of the reform. In the second chapter, I analyze the causal effects of exogenous changes in household income on the home environments of children in single-parent households. I use rich panel data from the Child Development Supplement of the Panel Study of Income Dynamics to construct a measure of warmth and affection in the child’s environment. I use an instrumental variables approach that exploits household-specific expansions of the Earned Income Tax Credit and the Child Tax Credit. I show that exogenous changes in income have a positive effect on children’s emotional environment. I complement this result with evidence on two potential mechanisms: housing conditions and childcare arrangements. I document that changes in income due to changes in the generosity of the tax credit increase the probability of moving in the month following the tax credit payment, and that there is an improvement in the crowding and quality of housing. I also find evidence of changes in child care arrangements, as children spend more time with their father and other adults, and more time in educational activities. These findings underscore the importance of tax credits in creating healthier home environments for vulnerable families. In my final chapter, joint with Thomas F. Crossley and Peter Levell, we address the longstanding puzzle in macroeconomics of why individuals with similar levels of available liquidity can have very different marginal propensities to consume (MPCs). We use a new approach to better investigate differences in consumer behaviour in response to hypothetical, one-off gains and losses: using open-ended questions and text analysis to understand the motives underlying consumers decisions. High liquidity individuals with high MPCs often cite mental accounting motives. Apparently illiquid individuals report a range of coping mechanisms in response to a loss, including labour supply responses, relying on friends and family and selling possessions. This implies greater effective liquidity than narrow financial measures indicate.
Table of Contents
-- 1. Recruiting Better Teachers? Evidence from a Higher Education Reform in Chile -- 2. Income and Home Environment: Evidence from U.S. Tax Credits -- 3. What would you do with £500? (...in your own words)
Additional Information
Defence date: 03 December 2024
Examining Board: Prof. Thomas Crossley (University of Michigan, Supervisor); Prof. Sule Alan (Cornell University, Co-supervisor); Prof. Caterina Calsamiglia (Institute of Political Economy and Governance); Prof. Camille Terrier (Queen Mary University London)
Examining Board: Prof. Thomas Crossley (University of Michigan, Supervisor); Prof. Sule Alan (Cornell University, Co-supervisor); Prof. Caterina Calsamiglia (Institute of Political Economy and Governance); Prof. Camille Terrier (Queen Mary University London)