A Note on the Wage Effects of the 1972 Raising of the School Leaving Age in Scotland and Northern Ireland
| Date | 01 November 2018 |
| Published date | 01 November 2018 |
| Author | Franz Buscha,Matt Dickson |
| DOI | http://doi.org/10.1111/sjpe.12187 |
A NOTE ON THE WAGE EFFECTS OF
THE 1972 RAISING OF THE SCHOOL
LEAVING AGE IN SCOTLAND AND
NORTHERN IRELAND
Franz Buscha* and Matt Dickson**
ABSTRACT
In this note, we use the UK Labour Force Survey to estimate the wage return to
an additional year of schooling for Scotland and Northern Ireland exploiting the
1972 Raising of the School Leaving Age (RoSLA). Prior literature on this topic
has consistently ignored both countries in a UK context, likely due to an incor-
rect belief that they were not affected by the 1972 RoSLA until some years
later. We demonstrate that both countries were affected by the education reform
in 1972 and our estimates suggest a positive effect on hourly wages for Scotland.
II
NTRODUCTION
The UK literature estimating the returns to education has made frequent use of
the 1972 Raising of the School Leaving Age (RoSLA) reform. This reform
increased the minimum school leave age from 15 to 16 and can be used to con-
struct a valid instrument for schooling in order to identify the causal effect of
schooling on later outcomes. Using this reform previous research has found a
positive impact on wages from an additional year of schooling, though the mag-
nitude of this effect is sensitive to the data set and estimation method used, vary-
ing between 6% and 22% (see Chevalier and Walker, 2002; Buscha and
Dickson, 2012; Dickson, 2013; Grenet, 2013). There is also a broader RoSLA
literature exploiting the 1972 reform to examine the causal effect of schooling
on a range of outcomes including health (Silles, 2009; Powdthavee, 2010; Clark
and Royer, 2013), fertility (Silles, 2011) and crime (Machin et al., 2011).
However, although the 1972 education reform was a UK-wide reform and
affected all four countries (England, Wales, Scotland and Northern Ireland) at
the same time, the majority of studies that use this identification strategy
exclude Scotland and Northern Ireland from their analysis. It is unclear why
so many studies excluded these two countries but it seems that many authors
incorrectly believed that the raising of the school leaving age from 15 to 16
*University of Westminster
**University of Bath
Scottish Journal of Political Economy, DOI: 10.1111/sjpe.12187, Vol. 65, No. 5, November 2018
©2018 Scottish Economic Society.
572
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