In a recent working paper, Carvalho and Koyama explore how cultural identity may influence one’s attitude towards education.
It seems to be a fact that certain groups underinvest in their education relative to others. This phenomenon can be observed in many countries. The hypothesis of the authors is that this is due the fact that education (in a sense) teaches mainstream culture. People belonging to different (sub)cultures thus might resist education for fear of losing their identity.
Two straightforward examples are African Americans and the White British working class. African American test scores tended to get closer to white test scores (both in reading and math) from year to year from the 1970’s. But then around 1990 there was a break. African Americans had not yet caught up with whites and yet suddenly their growing scores started stagnating as the picture below illustrates (left: math, right: reading).
The main problem with the authors’ hypothesis that comes to my mind is best shown by this picture as well. If it is indeed cultural traits that induce African Americans to resist education, then why did this effect suddenly kick in in 1990 and was unheard of before? Did African American culture suddenly change? As we will later see in this post, there is a potential explanation that doesn’t require African American culture to change and that can still explain the trend seen in the picture.
The second example of resistance to education can be found among White British working class children. The table below shows the percentage of poor students (= eligible for free lunch) with at least five A-C grades.
Clearly, poor White people in Britain do much worse than the poor of other races. I am not an expert on Britain but the authors say there is a stark class division between working class people (often poor) and others (mostly richer) meaning that working class parents would not like their students to give up their identity and become part of the upper classes.
Thus we can see two very similar phenomena occuring in different circumstances: one non-mainstream culture is related to race, the other is related to class. The authors try to come up with a general solution that can explain both of these.
They develop a model in which there are two types of people from a cultural standpoint: mainstream and minority. One’s children can thus also acquire any two of these cultural traits but each parent would like their children to be the same type as her. Education reinforces the mainstream type. In other words, the more education a child gets, the more likely he is to acquire the mainstream cultural trait.
It is not surprising that under these conditions the authors arrive at the result that minority parents underinvest in the education of their children relative to mainstream parents. As the likelihood of acquiring the mainstream trait grows (i.e. as education becomes more mainstream culture-oriented), minority parents invest less while mainstream parents invest even more in education.
Even if returns to education increase, there exists a group of people who decrease their education as a result. This group consists solely of minority types. For this result to hold, however, it is necessary for the returns to education increase to be unequal across abilities (this phenomenon is referred to as “bias” in the model). What this means is that returns to education rise more for those with better abilities (better educated people) than for those with worse abilities (uneducated people).
(Strictly speaking, ability in the authors’ model doesn’t necessarily refer to inherent intelligence. It is actually a sort of catch-all variable for factors not explained by the model including for instance school quality or discrimination. From here on out, I will just say “ability” but I will mean this definition.)
While unequal returns to education may seem like a somewhat out-of-place assumption it is necessary for the result to hold and it is quite realistic. After all, in today’s world most of an increase on returns to education doesn’t come from someone completing 12 grades instead of 10, but from someone graduating from college instead of high school, or getting a (valuable) Master’s degree instead of just a Bachelor’s.
Matter of fact, unequal returns to education becomes a central part of the model if you really think about it. Basically, the model’s key result is that if there are unequal returns, then inequality in education will further increase. To see the intuition behind this, consider an increase in returns to education. Such an increase will be more significant for those with higher ability (due to the assumption of an unequal increase), which will lead mainstream types (who have generally higher abilities) to invest more in education. This will make the mainstream cultural trait even more prevalent in education and thus the probability of acquiring the mainstream trait for those pursuing an education will become higher. Minority parents don’t like this, so two opposing forces will act on them: a (slight) increase in returns to education (e) and an increase in the probability of their children acquiring the mainstream trait (q). For those minority children for whom e < q holds, it will actually be more beneficial to decrease education.
Note two things:
1. This can only occur to minority children because both e and q are positive for mainstream parents. Since mainstream parents want their children to acquire the mainstream trait, the fact that there is an increase in the probability of doing so is positive for them.
2. Not all minority parents will decrease the education of their children but there exists a group that will. Some minority children, however, may have abilities that are so high that the increase in returns to education at that level of ability offsets the increase in the probability of acquiring the mainstream trait. In other words, e > q.
So going back to the first graph presented in this post, can we explain why African American children had been catching up with White children until 1990 and then suddenly stopped? Perhaps, unequal increases in returns to education are the culprit. It is possible that returns to education had been increasing at a roughly equal rate for people at all skill levels. But then around 1990, increases in returns for those with lower skill levels dropped significantly below returns for those with high skill levels. (Or possibly, it all happened somewhat earlier but it took time for the effect to kick in.) One could think of the loss of manufacturing jobs as one of the contributing factors to this phenomenon.
Undoubtedly, it was around this time that college education became the “default education” and that thus most jobs started requiring Bachelor’s degrees. For instance, in the UK there was a dramatic expansion of university places at this time. The eligible population for university studies increased from 13% in 1980 to 33% in 2000 to 39% in 2010, showing that this trend has not completely disappeared yet (see p.20 of the paper).
Think of affirmative action as well. What does affirmative action do? It raises returns to education for minority types. The mechanism works the same way as described above: basically, affirmative action will spread the mainstream trait through the minority group. But low ability minority types will have less to gain from affirmative action than they lose from the increased probability of acquiring the mainstream trait due to exposure to education. Therefore, lower ability minority types are actually induced by affirmative action to reduce their education. And indeed, clearly affirmative action policies have not been successful as the first graph of this post shows.
All in all, a very nice paper with a novel message (at least in such a general form). I concentrated on the intuition in this article; one can find the technicalities in the paper. Note that, for the sake of exposition, I used some notation here in a different way than is used in the paper (namely, e and q).