Education and social capital: empirical evidence from microeconomic analyses Huang, J.

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1 UvA-DARE (Dgtal Academc Repostory) Educaton and socal captal: emprcal evdence from mcroeconomc analyses Huang, J. Lnk to publcaton Ctaton for publshed verson (APA): Huang, J. (2010). Educaton and socal captal: emprcal evdence from mcroeconomc analyses Amsterdam: Thela Thess General rghts It s not permtted to download or to forward/dstrbute the text or part of t wthout the consent of the author(s) and/or copyrght holder(s), other than for strctly personal, ndvdual use, unless the work s under an open content lcense (lke Creatve Commons). Dsclamer/Complants regulatons If you beleve that dgtal publcaton of certan materal nfrnges any of your rghts or (prvacy) nterests, please let the Lbrary know, statng your reasons. In case of a legtmate complant, the Lbrary wll make the materal naccessble and/or remove t from the webste. Please Ask the Lbrary: or a letter to: Lbrary of the Unversty of Amsterdam, Secretarat, Sngel 425, 1012 WP Amsterdam, The Netherlands. You wll be contacted as soon as possble. UvA-DARE s a servce provded by the lbrary of the Unversty of Amsterdam ( Download date: 10 May 2018

2 472 Socal captal s consdered an mportant asset for ndvduals, groups, communtes and socety because t s related to ndvdual health and soco-economc status, and t affects the crme rate, socal coheson, and socal welfare. The purpose of ths dssertaton s to provde a detal descrpton of the formaton of ndvdual socal captal and the role of educaton, wth an emphass on educaton endogenety and gender dfferences. Meta-analyss s performed to evaluate the possble sources of the varatons n the effect of educaton on socal captal n the relevant lterature. The one-factor model and the sngle treatment model are appled to the data of the Natonal Chld Development study n order to quantfy the exact mpact of educaton. The emprcal fndngs n ths dssertaton reveal that schoolng varance s a key source of varaton n ndvdual socal captal outcomes, drectly or ndrectly. Educaton posts much hgher returns for men than for women on both dmensons of ndvdual socal captal: socal trust and socal partcpaton. The educaton effect s even negatve for women n the study of membershp of voluntary groups, whlst there s a strongly postve estmate for men n the studes of socal trust and voluntary partcpaton. The study shows that ncreased pressure from the workplace decreases satsfacton wth the job, lowers percepton of personal happness, and dverts avalable tme or energy away from voluntary partcpaton Educaton And Socal Captal Jan Huang Educaton And Socal Captal Emprcal Evdence From Mcroeconomc Analyses Jan Huang Jan Huang Enrolled n the M.Phl program of the Tnbergen Insttute n 2003 and receved hs M.Phl degree n He then started hs Ph.D research n the economcs of educaton at the Unversty of Amsterdam and he spent 5 years workng on the nonmonetary return to educaton. In September 2009, he has joned the Top Insttute for Evdence Based Educaton Research (TIER) at the Unversty of Amsterdam as a post-doc researcher. Research Seres Unverstet van Amsterdam

3 EDUCATION AND SOCIAL CAPITAL EMPIRICAL EVIDENCE FROM MICROECONOMIC ANALYSES

4 ISBN Cover desgn: Crasborn Graphc Desgners bno, Valkenburg a.d. Geul Ths book s no. 472 of the Tnbergen Insttute Research Seres, establshed through cooperaton between Thela Thess and the Tnbergen Insttute. A lst of books whch already appeared n the seres can be found n the back.

5 EDUCATION AND SOCIAL CAPITAL EMPIRICAL EVIDENCE FROM MICROECONOMIC ANALYSES ACADEMISCH PROEFSCHRIFT ter verkrjgng van de graad van doctor aan de Unverstet van Amsterdam op gezag van de Rector Magnfcus prof. dr. D.C. van den Boom ten overstaan van een door het college voor promotes ngestelde commsse, n het openbaar te verdedgen n de Agnetenkapel op dnsdag 25 me 2010, te 16:00 uur door Jan Huang geboren te Huazhou, Chna

6 Promotoren: Prof. dr. H. Maassen van den Brnk Prof. dr. W.J.N. Groot Facultet Econome & Bedrjfskunde

7 Acknowledgement Ths doctoral dssertaton represents fve years of research work on the relatonshp between educaton and socal captal. In these fve years, I have been fortunate to know many nce people and to work wth them. It s a pleasure to thank all these people who gave me the possblty to complete ths dssertaton. Frst of all, I would lke to express sncere grattude to my promoters, Professor Henrëtte Maassen van den Brnk and Professor Wm Groot, for ther contnuous support and gudance of my Ph.D study and research over the years. They have read nnumerable tmes of the drafts and provded many nsprng comments. They have contrbuted substantal efforts to make ths thess possble. I would lke to thank my commttee members Professor Bernard van Praag, Professor Henk Flap, Professor Herman G. van de Werfhorst, Professor Joop Hartog, Professor Jules Theeuwes for takng ther tme to read and provde useful comments to ths dssertaton. Specal thanks are extended to my colleagues, Adam Booj, Chrs Van Klaveren, Monque de Haan and Sandra Maxmano, n the Department of Economcs at the Unversty of Amsterdam (UvA) and at the Top Insttute for Evdence Based Educaton Research (TIER). Although I dd not have fxed workng hours and I dd not appear n the Department of Economcs very often, I benefted from the nteractons wth these colleagues. I am grateful to Professor Erk Plug and Professor Hessel Oosterbeek for ther useful suggestons for and valuable gudance of my Ph.D study and research. I also wsh to thank Carla Lessen, Sebastene Postma, and other staff n TIER and SCHOLAR for runnng these departments so smoothly, and for assstng me to tackle many admnstratve problems. Sncere grattude goes to my colleagues and frends n the Tnbergen Insttute and n other unverstes of the Netherlands for makng my academc career full of fun and brngng pleasures nto my lfe: We Chen, Ja-Ja Cu, Lnda Mdgley, Mchel van der Wel, Le Pan, Razvan Vlahu, Rocco Huang, Ronald Wolthoff, Sumedha Gupta, Tse-Chun Ln, Jan-Bn Xao, Nan Yang, and Yang Yang. Specal apprecaton s due to my famly for ther understandng and love. I owe many thanks to my father Long-Gu Huang, my mother Yan-Mng L, and my brother Y Huang. I am ndebted to my aunt Xao-Bng Huang, my cousn Guo Chen, and my partner s mother

8 Chn-Yn Ln for ther support n so many ways. Fnally, I would lke to convey my specal thanks to my partner Yn-Yen Tseng, although there s no word, Englsh or Chnese, to express my apprecaton for her dedcaton, love and confdence n me. It would have been mpossble for me to fnsh ths work wthout her backng me and her carng of our beautful daughter S-Yuan Huang. Ths dssertaton s dedcated to Yn-Yen Tseng and S-Yuan Huang.

9 TABLE OF CONTENTS CHAPTER 1 INTRODUCTION TO SOCIAL CAPITAL THEORY SOCIAL CAPITAL ATTRIBUTES, IMPORTANCE AND MEASUREMENT OF INDIVIDUAL SOCIAL TRUST ATTRIBUTES, IMPORTANCE AND MEASUREMENT OF SOCIAL PARTICIPATION... 5 CHAPTER 2 A META-ANALYSIS OF THE EFFECT OF EDUCATION ON SOCIAL CAPITAL INTRODUCTION DESCRIPTIVE STATISTICS AND SIMPLE ANALYSIS OF POOLED EFFECT SIZES ANALYSIS OF THE EXTENDED MODEL PUBLICATION BIAS, TEST AND CORRECTION DISCUSSION AND CONCLUSION APPENDIX 2 CODING OF VARIABLES AND HEDGE S TEST FOR PUBLICATION BIAS APPENDIX 2A CODING OF THE EFFECT SIZE APPENDIX 2B TREATMENTS OF MISSING VALUES FOR SPECIFIC GROUPS APPENDIX 2C HEDGES TEST FOR PUBLICATION BIAS CHAPTER 3 EARLY CHILDHOOD INFLUENCE, EDUCATION, AND SOCIAL CAPITAL INTRODUCTION HYPOTHESES AND REVIEWS INTRODUCTION TO THE NATIONAL CHILD DEVELOPMENT STUDY RESULTS EDUCATION ENDOGENEITY AND CAUSAL EDUCATIONAL EFFECTS CONCLUSION APPENDIX 3 DETAILS OF THE ASSUMPTIONS AND DERIVATION OF THE NON-PARAMETRIC BOUNDS CHAPTER 4 ENDOGENEITY MODELS FOR SINGLE TREATMENT EVALUATION WITH A BINARY OUTCOME INTRODUCTION OF THE SINGLE TREATMENT MODEL SIMULATION DESIGN SIMULATION RESULTS CONCLUSION CHAPTER 5 COLLEGE EDUCATION AND SOCIAL TRUST FORMATION: EVIDENCE FROM A BRITISH COHORT STUDY INTRODUCTION DATA EVALUATION OF THE ATE SENSITIVITY TEST AND POST-EDUCATION RE-EVALUATION CONCLUSION APPENDIX 5 CODING OF VARIABLES AND REGRESSION DETAILS ON SOCIAL TRUST OUTCOME APPENDIX 5A CODING OF VARIABLES APPENDIX 5B ESTIMATION RESULTS FOR ALL SIGNIFICANT VARIABLES IN SOCIAL TRUST OUTCOME... 87

10 CHAPTER 6 HIGHER EDUCATION AND MEMBERSHIP OF VOLUNTARY GROUPS INTRODUCTION EVALUATION METHOD INTRODUCTION OF NCDS DATA SET AND EVALUATION OF EDUCATION EFFECTS FURTHER ANALYSIS CONCLUSION APPENDIX 6 CODING OF VARIABLES AND ADDITIONAL FINDINGS IN EMPIRICAL STUDIES APPENDIX 6A CODING OF VARIABLES APPENDIX 6B ADDITIONAL FINDINGS IN EMPIRICAL STUDIES CHAPTER 7 CONCLUSIONS REFERENCE

11 Chapter 1 Introducton to Socal Captal Theory 1.1 Socal captal Socal captal s consdered an mportant asset for ndvduals, groups, communtes and socety because t s related to ndvdual health and soco-economc status, and t affects the crme rate, socal coheson, and socal welfare (Portes, 1998; Ln, 2001; Flap and Boxman, 2001; Flap, 2004; Hellwell, 2001). The nterest n socal captal has led to an exploson of studes on ts economc and socal effects, as well as on ts sources of orgn and accumulaton mechansms. Socal captal s a heurstc concept wth dverse and multdmensonal defntons and operatonalzatons, and research has expanded nto numerous arenas and applcatons. Coleman defnes socal captal as socal-structural resources that facltate certan actons of ndvduals who are wthn the structure (Coleman, 1990a, p. 302). Putnam et al. (1993) and Putnam (1995a, 1995b) extends the term socal captal to descrbe elements of socal lfe such as networks, norms, and trust that facltate coordnaton and cooperaton for mutual beneft. The World Bank and the Organsaton for Economc Co-operaton and Development (OECD) have also consdered the defnton of socal captal. The OECD defnes socal captal as networks together wth shared norms, values and understandngs that facltate co-operaton wthn or among groups (Cote and Healy, 2001, p. 41). The World Bank suggests that socal captal refers to the nsttutons, relatonshps, and norms that shape the qualty and quantty of a socety s socal nteractons. The scope of socal captal ranges from the mcro- and meso- levels to the macro-level, as revewed by Grootaert (1998), Grootaert and Van Bastelaer (2001). These scopes are characterzed by socal norms and recprocty at varyng socal scales, from ndvdual to the level of communtes and naton states. The mcro-level of socal captal, or socal captal at the ndvdual level, s generally classfed as an aggregaton of personal nvolvement n voluntary assocatons and trust n people: those we know and those we do not know. The meso-level refers to the number and densty of groups n a gven communty wth the assumpton that socal captal s nherently good, that more s better, and that ts presence always has a postve effect on a communty s welfare. The meso-perspectve equates socal captal wth such local organzatons as clubs,

12 2 Chapter 1 assocatons, and cvc groups n the communty or regon. Macro-level socal captal ncludes the socal and poltcal envronment that shapes socal structure and enables norms to develop. At the macro-level, researchers, such as Coller (1998) and Baumann (2000), defne the poltcal or nsttutonal level on the bass of the argument that the vtalty of communty networks and cvl socety s largely the product of the poltcal, legal, and nsttutonal envronment. Researchers, such as Putnam et al. (1993) and Fukuyama (1995), defne the ethnc level or cultural level accordng to the ethnc and cultural heterogenety n the level of generalzed trust, norms of recprocty, and conventonal habt n partcpatng n cvc actvtes across natons and races. So far, the most compellng emprcal evdence n support of the socal captal theory comes from studes on the ndvdual level, where t s possble to employ mcroeconomc analyss, and t lends tself to easer applcaton and generalzaton n emprcal models of research. At the meso- and macro-level, researchers do not have a unform defnton, and there s no standard and convncng quanttatve economc measure of collectve socal captal avalable. Overall, decsons to nvest n socal captal are made by ndvduals, not communtes. Wthout a defnton of socal captal that begns at the ndvdual level I cannot begn to understand ts formaton (Glaeser, 2001). Ths dssertaton wll focus on two commonly dscussed dmensons of socal captal at the mcro-level ndvdual socal trust, and ndvdual socal partcpaton. The presence of socal captal s ndcated by a hgh degree of trust n most people and partcpaton n collectve acton, and these elements renforce one another n a vrtuous crcle (Putnam, 2000). 1.2 Attrbutes, mportance and measurement of ndvdual socal trust Socal trust s the amount of trust ndvduals have n most people, those they know and do not know. Socal trust reflects the bond that people share across economc and ethnc groups. It s the foundaton of a cooperatve sprt that brngs people together for common and mutually advantageous purposes (Rothsten and Uslaner, 2005). On the bass of a revew of the lterature on socal trust, two dmensons of socal trust are dstngushed at the mcro-level: A. Indvdual percepton of the socal envronment; B. Indvdual moral values.

13 Introducton to Socal Captal Theory 3 Frstly, socal trust s an ndcator of the ndvdual percepton of the socal envronment. It reflects the ndvdual assessment about how people n general are behavng, and how socety s developng. From ths perspectve, the degree of socal trust depends on socal crcumstances, as well as on ndvdual knowledge and ratonalty n assessng socal rsks and uncertantes. Communty safety (n terms of crme rates), communty homogenety (n terms of ethncty or soco-economc class), and farness of socal welfare (n terms of wealth dstrbuton, racal and gender equalty) are crtcal determnants of socal trust at both the ndvdual and socetal levels. Recent studes suggest that uncertanty arsng from socal heterogenety s a key mpedment for socal trust formaton. Alesna and La Ferrara (2002) propose that most ndvduals are less nclned to trust people who are dfferent from themselves. Socal trust also embodes the ndvdual sense of farness or justce n socety. Rothsten and Uslaner (2005) argue that socal trust orgnates from an equtable dstrbuton of resources and opportuntes n a socety. It has been shown n many surveys that the countres wth the hghest scores on socal trust, lke the Nordc countres, the Netherlands, and Canada, also rank hghest n terms of economc, gender and racal equalty. Secondly, socal trust has ts roots n the ndvdual moralty that people follow n socal and daly lfe (Uslaner, 1999). People who beleve n racal and gender equalty, for nstance, are more tolerant towards mnortes and towards others who are not lke themselves, and these people have a hgher level of trust n others. Trustworthness s a crucal moralty that s assocated wth socal trust. People who consder themselves to be untrustworthy are less trustng of others (Putnam, 2000, p. 138). Glaeser et al. (2000) also propose that trustworthness can be correlated wth gvng postve answers to the queston about trustng others, accordng to ther study based on a trust experment. A typcal reason for such correlaton s, as one man put t, I feel f I can be trusted, I can trust other people. Throughout my lfetme I ve found that to be true, that f you are up and above and honest wth people, they wll return that respect (Wuthnow, 1998). Therefore, one s wllngness to trust others can be a reflecton of one s self-knowledge of whether one can trust oneself and one s feelng of whether one needs to be trustworthy for recprocty. Whle the ndvdual percepton of socal envronment and ndvdual moralty are the basc aspects of socal trust at the ndvdual level, these notons do not share the same features. Socal trust as a percepton of socal rsks and farness s a knowledge cumulatve functon, whch s strongly correlated wth socal envronment, ndvdual standng or bearng n socety, and ndvdual self-mage of one s ablty n handlng the uncertantes n socety. Socal trust as a moral value stems from famly and school nfluence and s possbly exposed

14 4 Chapter 1 to ndvdual lfe experences, n partcular, traumatc experences (Alesna and La Ferrara, 2000b). The mportance of socal trust has been wdely recognzed. Socal trust reflects a bond that people share across socety, across economc and ethnc groups, relgons and races. It s the foundaton of a cooperatve sprt that brngs people together for common and mutually advantageous purposes (Rothsten and Uslaner, 2005). Socal trust correlates wth many varables that are normatvely desrable for most people. Those who beleve that most other people n ther socety n general can be trusted are also more nclned to have a postve vew of ther democratc nsttutons and partcpate more n cvc organzatons. Indvduals wth a hgher level of trust n people also have a more optmstc vew of beng able to control ther own lfe-chances, and, not less mportant, are happer wth how ther lfe s gong (Uslaner, 2005). Socal trust also contrbutes to economc growth and market effcency. Knack and Keefer (1997) fnd that a one standard devaton ncrease of the natonal-level of socal trust ncreases economc growth by more than one-half of a standard devaton. Hgh levels of socal trust lead people to expect that others are cooperatve and not opportunstc n socal and economc exchanges, whch reduces transacton cost and helps solve the free-rder problem n provdng publc goods. La Porta et al. (1997) show that socal trust promotes the performance and character of poltcal nsttutons. It s postvely correlated wth judcal effcency, and negatvely correlated wth government corrupton. Socal trust s usually measured by the response to the followng queston: Generally speakng, would you say that most people can be trusted or that you can t be too careful n dealng wth people? Ths operatonalzaton of socal trust has been wdely used for more than four decades n emprcal studes and surveys around the world, ncludng the Natonal Chld Development Study (NCDS) n the UK, the General Socal Survey (GSS) n the US, and the World Values Survey (WVS). Whle the survey queston s controversal among some researchers for ts abstract defnton wth respect to whch people respondents have n mnd, t has been proved nformatve n many studes. Uslaner (2002) ponts out that ths measurement of socal trust provdes useful nformaton on respondents fath n other people, and t s far beyond beng smply an ndcator of respondents nteractons wth ther ntmates. Many emprcal studes on the benefts of socal trust employ ths measurement as the man ndcator, and they provde plenty of evdence for the postve effects of socal trust at the ndvdual and socetal level (see, e.g., Knack and Keefer, 1997; La Porta et al., 1997; Whteley, 2000).

15 Introducton to Socal Captal Theory Attrbutes, mportance and measurement of socal partcpaton Socal partcpaton refers to people s socal nvolvement and nteracton wth others. It s defned n ths thess as the organzed collectve actvtes assocated wth voluntary groups and organzatons relatng to communty lvng and welfare. These socal groups and organzatons are outsde the poltcal arena and the workplace (.e. unons, partes, votng and lobbyng groups). Based on Max Weber s typology ([1914]1978) of socal acton, actvtes n unons, partes, votng and lobbyng groups are nstrumentally ratonal acton, servng the purpose of certan nterest groups. These group actvtes do not share the same contexts wth socal partcpaton as defned n ths thess. Socal partcpaton occurs n neghborhood assocatons, envronment groups, charty groups and other communty or voluntary organzatons. Socal partcpaton s a form of affectve or value ratonal behavor; t consttutes ts own reward and s regarded as a type of expressve acton. Ln vews nstrumental acton as drected at obtanng new resources, whle expressve acton s drected at preservng or mantanng resources (Ln, 2001; Ln and Erckson, 2008). There are dfferences between nstrumental acton and expressve acton n terms of gender nvolvement. Women are much less lkely to jon n poltcal groups, labor unons and staff assocatons. They tend to partcpate n smaller, more perpheral organzatons and actvtes wth a focus on domestc or communty affars, whle men tend to partcpate n large, core organzatons that are related to economc nsttutons and poltcal actvtes. The local and communty aspects that socal groups focus on can be prvate nterest-orented, such as parent-teacher assocatons (PTAs), tenant assocatons, as well as altrustc nterest-orented, such as charty, envronmental and communty volunteerng. These socal groups are establshed to facltate people s effectve nvolvement n communty lfe, to mprove the lvng envronment or teachng qualty, and to ncrease socal well-beng. Socal partcpaton can act as a resource for the people nvolved by ncreasng access to nformaton (Knoke, 1990). Group members acqure organzatonal sklls and expand ther socal tes n ways that may have a postve mpact on ther physcal and mental health. (House et al., 1988). Researchers beleve that socal partcpaton helps to promote a sense of communty and norms of recprocty and facltate the transmsson of knowledge. In addton, a hgh level of socal partcpaton s supposed to rase cvc norms among people and strengthen the foundatons of a democratc socety. To measure an ndvdual s socal partcpaton level, two sub-categores are dstngushed to capture the complexty and dversty of socal partcpaton: membershp of voluntary

16 6 Chapter 1 socal groups and partcpaton frequency n voluntary actvtes. Researchers conventonally rely on membershp of socal groups: namely, group membershp as a man ndcator of the level of socal partcpaton. Partcpaton frequency n actvtes related to socal groups s also an ndcator used to study an ndvdual s nvolvement n socal actvtes. Voluntary partcpaton s a self-mposed oblgaton n socal groups, whch s not dctated by others; the ndvdual may choose to partcpate, to a greater or less extent, or not at all. Thus, partcpaton frequency n group actvty s an mportant subject n socal partcpaton studes. The partcpaton outcome varables n ths dssertaton are measured as ether the probablty of jonng voluntary groups/partcpatng n voluntary actvtes or the degree of socal nvolvement. 1.4 Educaton and socal captal Educaton, accordng to Putnam (1995a, 1995b, 2000), Brehm and Rahn (1997), Glaeser et al. (1999), and Alesna and La Ferrara (2000a), s one of the most mportant determnants of ndvdual socal captal. It reflects an orentaton toward the future by strengthenng human captal and socal captal for economc and socal development. Schoolng spreads knowledge the basc component of human captal, and cultvates socal norms the core of socal captal. It s the frst non-famlal context n an ndvdual s lfe where moral and cogntve capactes are traned (Offe and Fuchs, 2002). Through cvl educaton from schoolng, students learn the basc norms and responsbltes n socety, as well as the functonng of democracy. Glaeser et al. (1999) assert that the most robust correlate of socal captal varables s years of schoolng. Usng the World Values Survey, they fnd a postve relatonshp between schoolng and membershp of organzatons n almost every country. Denny (2003) clams that acqurng a 4-year unversty degree s assocated wth a 10 percent hgher probablty of an ndvdual engagng n voluntary work. Putnam (1995a, 1995b, 2000), Uslaner (1997, 1998), and Alesna and La Ferrara (2000a, 2000b) also show that more educated people are more lkely to trust other people, and that they tend to jon more socal organzatons and partcpate n group actvtes more frequently. In studes on prvate returns to educaton, the endogenety of schoolng s always a dffcult topc to tackle. It s confrmed that ncome and educatonal attanment can be smultaneously nfluenced by a wde range of unobservable terms, and that the omtted-varable problem could lead to an upward bas n the estmate of the educaton effect.

17 Introducton to Socal Captal Theory 7 Smlar problems can emerge n the nvestgaton of the relaton between educatonal attanment and socal captal. The dvergence n the transtons of educaton and socal partcpaton n Western countres casts another shadow on the postve role of educaton. Over the second half of the twenteth century, most Western countres hve experenced an evoluton from an eltst hgher educaton system to a mass hgher educaton system, and the average educaton level of people ncreased dramatcally. Fgures from the OECD Educaton at a Glance 2007 show that more than one n fve adults n OECD countres have receved tertary educaton. If educaton s a major source of socal engagement, there should also have been a substantal rse n the socal partcpaton rate for these countres. However, t appears n many socal reports that nowadays more people are dsengagng from cvc lfe and socal tes as they belong to fewer voluntary groups, they volunteer less, and they gve a smaller share of ther ncome to charty (Knack, 1992; Putnam, 1995a, 1995b). Wth the excepton of the Scandnavan countres and Japan where levels have remaned relatvely stable, there seems to be a common pattern of declnng organzatonal actvty across ndustralzed democraces durng the 1980s and 1990s (Legh, 2003). There s thus reason to be skeptcal about the role that hgher educaton plays n the formaton of socal partcpaton behavor. Its hypothetcal mpact on socal partcpaton needs to be further verfed. Ths dssertaton provdes a systematc evaluaton of the role of educaton n the formaton of socal captal from dfferent perspectves. A research synthess s conducted on the estmates of the educaton effects on ndvdual socal captal, and n Chapter 2 a meta-analyss s performed to evaluate the possble sources of the varatons n the effect of educaton on socal captal n the relevant lterature. Several aspects n the meta-analyss wll be nvestgated further n the later sectons of ths thess. Analyses are presented on whether dfferent educaton measurements have an mpact on the sze of the schoolng effect, wth an emphass on schoolng endogenety. Efforts are taken to develop an assessment of an explct causal pathway from hgher educaton to the formaton of socal captal from a md-lfe perspectve. Potental gender dfference n the assocaton between educaton and socal captal s another key subject of ths thess. The tradtonal gap n the partcpaton n hgher educaton between men and women has been narrowed or has even dsappeared over the last half century, and hghly-educated women are keener to move out of ther home nto pad employment. The ncreasng number of women who are both breadwnners and caregvers may drectly result n ther hgher work pressure, greater tme constrants, and consequently less nvolvement n socal actvtes.

18 8 Chapter 1 Chapter 3 explores the relatons between socal captal n early chldhood, educaton achevement, and socal captal n adulthood wth a multple-stage analyss. Educaton s aggregated nto a sngle measure years of schoolng n ths study. In the later sectons of the dssertaton, a bnary treatment model s appled to evaluate the mpact of college/hgher educaton on socal trust and socal partcpaton. The control functons probt (CFP) and the bvarate probt (BVP) methods are appled to correct for omtted-varable bas n a sngle-treatment framework wth a bnary outcome. Model development and smulaton performance for the CFP and the BVP methods are presented n Chapter 4. In Chapters 5 and 6 these two methods are employed to study the causal mpact of college/hgher educaton on, respectvely, socal trust and socal partcpaton. Some lght wll be shed on the gender-specfc effect of educaton and the potental causal pathway from educatonal achevement to the development of socal captal from a md-lfe perspectve. Chapters 5 and 6 offer some emprcal fndngs that can be seen as clues to the puzzle that arses from the declne of socal captal and the development of educaton. Chapter 7 s a concludng chapter that dscusses and compares the evaluaton results from the prevous studes n ths dssertaton.

19 Chapter 2 A Meta-analyss of the Effect of Educaton on Socal Captal 2.1 Introducton There are many emprcal studes to corroborate the percepton that educaton s a central factor n the formaton of socal trust and socal partcpaton. However, results sometmes vary across studes because of heterogeneous survey sources, research methods and model specfcatons. It s therefore of academc nterest, as well as of polcy value to evaluate the possble sources of the varatons n the effect of educaton on socal captal n the lterature. Htherto, there has been no systematc synthess of ths topc n spte of the extensve lterature. For ths reason n ths thess a meta-analyss, a statstcal procedure that ntegrates the fndngs from ndependent studes, and that addresses a set of related hypotheses, wll be appled to shed some lght on the effect of educaton on socal captal. As dscussed above, ndvdual socal captal has two dmensons whch share dfferent attrbutes and measurements. Thus a standard comparson, effect sze, s necessary n order to fnd out the varaton between dmensons and wthn each dmenson. Effect sze can be conceptualzed as a standardzed dfference whch, n ts smplest form, s the mean dfference between groups n standard score form,.e. the rato of the dfference between the means to the standard devaton (Glass, 1976). In ths meta-analyss, an estmate of the return to educaton s obtaned as the effect of one year of schoolng on the probablty or level change of socal captal. So effect sze s calculated as the proporton of the standard devaton n the dependent varable (each dmenson of ndvdual socal captal) that s accounted for by one year of schoolng, by standardzng the estmate wth the correspondng standard devaton. Two crtera were used for the ncluson of the avalable lterature n the meta-analyss: (a) studes should focus on the determnants of at least one dmenson of socal captal at the ndvdual level wth formal educaton as a covarate n the model; (b) studes should have reported statstcal data (t-statstcs, p-value or standard error) that allow for estmaton by the fxed effects and random effects models. A data set was created for ths analyss that ncludes estmates from 65 studes. 28 studes provde estmates of the return to educaton on socal trust, and 37 studes provde estmates on socal partcpaton. Table 2.1 presents nformaton

20 10 Chapter 2 on the authors, year of publcaton, and survey perod, classfed by socal trust and socal partcpaton. The number of estmates vares markedly from 1 to 88because some studes provde the estmates of educatonal return for each naton n the surveys (for nstance, Denny (2003) evaluates the effect of schoolng on socal partcpaton for 20 countres, usng the Internatonal Adult Lteracy Survey; and Glaeser et al. (1999) evaluates the effect of schoolng on socal trust for 20 countres, usng the World Value Survey). The evaluaton methodology may dffer n the same study as authors may compare the estmates from a smple lnear model wth those from a model that accounts for endogenety of educaton on socal captal (see, e.g., Denny, 2003; Dee, 2003; Mllgan et al., 2003). Contextual varatons n the same study are also a key factor for the large number of effect szes, as authors may compare estmates from dfferent specfcatons of the model. They may nvestgate the dfference n the effects of schoolng n the model wth and wthout control for average educaton (such as Glaeser et al., 1999; Hellwell and Putnam, 1999; and Marshall and Stolle, 2004), or they may compare the return to educaton for men and for women, for the elderly and for young people, for college educaton and for hgh school educaton.

21 A Meta-Analyss of the Effect of Educaton on Socal Captal 11 Table 2.1 Sources for meta-analyss Socal Trust Study No of effect szes n study Survey Perod Socal Partcpaton Study No of effect szes n study Survey Perod Alesna & La Ferrara (2000a) Alesna & Ferrara (2000b) Alesna & La Ferrara (2002) Brehm & Rahn (1997) Brehm & Rahn (1997) Cho (2003) Clabourn & Martn (2000) Clabourn & Martn (2000) Glaeser & Sacerdote (2001) Cutler & Hendrcks (2000) Glaeser et al. (1999) Dee (2003) Hellwell & Putnam (1999) Denny (2003) Huang et al. (2009) DPasquale & Glaeser(1999) Ibáñez et al. (2002) Funk (1998) Johansson-Stenman et al. (2005) Glaeser & Sacerdote (2000) Lederman (2005) Glaeser & Sacerdote (2001) Lee et al. (2003) Glaeser et al. (1999) Legh (2006) Hauser (2000) Levnsen (2004) Hellwell & Putnam (1999) Marshall & Stolle (2004) Hooghe (2003) Mllgan et al. (2003) Huang et al. (2009) Newton (2001a) Kang & Kwak (2003) Rahn et al. (2003) La Ferrara (2002) Rothsten & Uslaner (2005) Lederman (2005) Rothsten (2001) Letk (2008) Scheufele & Shah (2000) Levnsen (2004) Shah et al. (2001) L et al. (2003) Uslaner (1997) Lu & Besser (2003) Uslaner (1998) Mllgan et al. (2003) Uslaner (2003) Norrs (1996) Uslaner (2004) Patrca et al. (1999) Wlson & Musck (1997) Patte et al. (2003) Wollebæk & Selle (2003) Scheufele & Shah (2000) Shah (1998) Shah et al. (2001) Stoneman & Anderson (2006) Tang (2006) Tanguch (2006) Tehen (2000) Uslaner (1997) Uslaner (1998) Wellman et al. (2001)

22 12 Chapter 2 The majorty of studes n ths data set do not consder the possblty that the choce of educatonal attanment and socal captal are smultaneously nfluenced by unobserved heterogenety specfc to the ndvduals. Ths gnorance of the endogenety problem can cause based estmates of the educatonal nfluence. For example, t s plausble that people wth good relatons wth parents and frends n ther chldhood may obtan a better educaton and have a hgher level of socal captal n adulthood. However, these nteractons n chldhood usually turn out to be unobservable to researchers. Some studes n the data set have taken account of the endogenety problem. Usng polcy reform dummes as nstruments,.e. the ncrease n the mnmum schoolng age and abolton of tuton fees for secondary school, Denny (2003) apples a two-step procedure n the evaluaton for Brtan, Italy, Northern Ireland and the Republc of Ireland. The results of hs study are mxed, although he observes a postve relaton between educaton and altrustc (charty) actvtes n most West European countres. Dee (2003) employs 2SLS and bvarate probt, by relyng on changes n teen exposure to chld labor laws, n order to estmate the educatonal mpact on the probablty of jonng socal groups and volunteerng n socal servces, and the mpact on the number of afflated groups. He confrms the substantal causal effect of schoolng on most measurements of socal partcpaton, except for the frequency of voluntary work. Changes n compulsory schoolng law are also appled n the studes of educaton and socal trust. Mllgan et al. (2003), for example, apply ths strategy n ther study of the nfluence of educaton on trust and other cvc outcomes. They do not observe any substantal dfference between the estmates from OLS and 2SLS regressons. Does the estmaton method whch accounts for the endogenety problem produce consderably dfferent estmates of educatonal return? The meta-analyss wll shed some lght on ths queston. It s also noteworthy that one s socal captal can be affected not only by one s own educaton, but also by that of others n one s socal envronment. The mpact of educaton on socal captal can be dvded nto a relatve effect and an absolute effect, accordng to Ne et al. (1996). The relatve effect ndcates that educaton s a proxy for relatve status, a sortng mechansm for people wth a hgher capacty to acqure socal captal. The absolute effect refers to the accumulaton of cvc values and knowledge. One s own educaton level s not drectly lnked to the level of ndvdual socal captal, gven that educaton merely serves to sort out people who have dfferent capabltes n socal captal (Ne et al., 1996; Hellwell and Putnam, 1999). Therefore, as Ne et al. argue, f more people have a college degree, then ths means that perhaps the socologcal sgnfcance of the hgh school leavng certfcate has

23 A Meta-Analyss of the Effect of Educaton on Socal Captal 13 been devalued as a credental. Ths ssue s covered n ths meta-analyss. Both effects of educaton wll be assessed by evaluatng the effects of ndvdual schoolng years and average schoolng years n the regon concerned. I further test whether the mpact of one more year of schoolng on ndvdual socal trust and ndvdual socal partcpaton vares across dfferent levels of educaton, or whether t rses wth educatonal attanments. Coleman (1990a), Putnam et al. (1993) and Putnam (1995a) suggest a recprocal effect between trust n general people and partcpaton n socal actvtes: Socal trust, norms of recprocty, networks of a cvc engagement and successful cooperaton are mutually renforcng (Putnam et al., 1993, p.180). Brehm and Rahn (1997) post an asymmetrc causal chan n whch trust s the drect outcome of cvc engagement. But ths asymmetrc assocaton s dsputed by Uslaner (1997), who argues that trust shapes cvc partcpaton. These hypotheses wll be tested by ncludng controls for recprocty between trustng and partcpatng n the meta-analyss. Many studes, such as Brehm and Rahn (1997), Clabourn and Martn (2000), Newton (2001b), Ibáñez et al. (2002), L et al. (2003), Lu and Besser (2003), Rahn et al. (2003), and Uslaner (1997, 1998, 2003, 2004b), and some others n the data set provde nformaton on the role of schoolng n ths recprocty mechansm. Several other questons wll be assessed on the relaton between educaton and ndvdual socal captal. For nstance, are gender dfferences a crtcal factor n explanng the varaton n the effects of educaton? Does educaton play a role n what s referred to as the eroson of socal captal durng the past few decades? Amercans are beleved to have more socal captal than people n other natons (Putnam 1995a, 2000). In ths connecton, by means of a meta-analyss of the estmates taken from the surveys across natons, t s possble to examne whether educaton systems n the US and other natons are related to the socal captal nequalty. 2.2 Descrptve statstcs and smple analyss of pooled effect szes An effect sze (ES) measure s a common currency n the meta-analyss to evaluate the estmates across studes. In ths study the effect sze s obtaned as the proporton of the standard devaton n the dependent varable that s accounted for by one year of schoolng, by standardzng the study estmate wth the correspondng standard devaton. Part A of Table 2.2 presents the summary means of the pooled effect szes. They are for socal trust and for socal partcpaton. That s, one addtonal year of schoolng ncreases one s socal trust by 4.6 percent of ts standard devaton and ncreases socal

24 14 Chapter 2 partcpaton by 4.8 percent of ts standard devaton. Therefore, one standard devaton of schoolng years, whch s years for most countres, accounts for the varaton n socal trust and socal partcpaton by percent of ther standard devaton. The summary statstcs present a smple and gross descrpton of the magntude of the effect szes. The fxed effects and random effects models are general methodologes for meta-analyss. The fxed effects model n the smplest form assumes a global and homogeneous populaton effect sze across the studes, such that: * t = t + µ t ~ N( t *, v ), where t s the estmated effect sze and varance of the measurement error * t s the true populaton effect sze; and v s the µ due to estmaton on a sample smaller than the entre target populaton. The random effects model, n ts smplest form, allows for heterogenety n the global populaton effect szes, usually by assumng that the true effects follow a normal dstrbuton wth a mean * t and a varanceτ 2 : t = t + µ t t * * ~ N( t * ~ N( t, v ) * 2, τ ). In meta-analyss 2 τ s commonly called between studes varance. Clearly, the fxed effects model, where τ 2 = 0, s a specal case of the random effects model. The fxed and random effects models wth a global populaton effect sze do not allow the true effect sze to be subject to the characterstcs of studes, whereas a central topc n research synthess s to fnd out whether methodologcal, contextual, or substantve varatons n research studes are related to varatons n effect sze parameters (Cooper and Hedges, 1994). A lnear model s generally appled to capture the effect of study heterogenetes: t = x +ε +µ, where x are observed characterstcs of the studes that cause varatons n the true effect, and s the vector of the coeffcents of the varables. There s no resdual heterogenety n

25 A Meta-Analyss of the Effect of Educaton on Socal Captal 15 the fxed effects model, thus resduals ε = 0 follow a normal dstrbuton wth a mean zero and a varanceτ 2.. In the random effects model, resdualsε Part B of Table 2.2 presents the estmates of the pooled effect of educaton under the assumpton that there s a global effect sze across studes. The estmates of the global effect sze vary between the fxed effects and random effects models (nverse varance weghtng used for poolng). The random effects model gves smlar estmates as the summary statstcs. The test statstcs (p-value < ) ndcate a strongly sgnfcant, postve return to educaton for both fxed effects and random effects models. The Q-statstcs n Part C test the null hypothess that the true effect szes are homogeneous across studes, and thus there s no resdual heterogenety n the global effect sze (between studes varance 2 τ = 0). The Q-statstcs follow a Ch-squared dstrbuton wth N 1degrees of freedom, wth N beng the number of observatons n the meta-analyss. Sold evdence s found (p-value < ) for between-studes varance n both dmensons of socal captal, whch rejects the null hypothess that the true effect sze s homogeneous across studes, and therefore the fxed-effects model s not an approprate hypothess. Table 2.2 Summary statstcs, estmates of pooled effect sze and test statstcs for fxed effect Socal Trust Socal Partcpaton A. Summary statstcs Mean SD Mean SD Effect sze Measure error (s.e. of effect sze) B. Estmate of pooled effect sze Estmate z-value Estmate z-value Fxed effects Random effects C. Test for fxed effects Q-statstcs p-value < < Between studes varanceτ N

26 16 Chapter Analyss of the extended model Gven that study feature has no nfluence on the effect szes, the estmates from Table 2.2 ndcate that the pooled estmates of educaton are for socal trust and for socal partcpaton. In the meta-analyss, the assumpton of a global effect does not seem realstc and tenable. The statstcs classfed by groups n Table 2.3 show that the mean effect szes are markedly lower for the female group, for Non-US natons, and for surveys conducted after Note that, n studes of socal partcpaton, controllng for the average educaton level n the regon rases the effect sze substantally, whle accountng for schoolng endogenety reduces the effect sze dramatcally. Table 2.3 Mean effect sze by characterstcs of the study and the populaton Socal trust Socal actvty Specfc group Obs Mean Df * Sg of df ** Obs Mean Df * Sg of df ** Female Older age group (over 60=1) College graduate Survey after Non-US survey Average educaton control Educaton endogenety control Recprocty control Notes: Df refers to the mean dfference between the effect szes from the target group and the rest of the effect szes; Sg of df refers to the statstcal sgnfcance of the group dfference. To capture the mpact of study characterstcs, a lnear model whch allows for resdual heterogenety (random effect hypothess) s ntroduced nto the explanaton of the effect szes: t = +ε + µ. Few studes provde estmates of the return to schoolng for partcular x groups (for men or women, for elderly or non-elderly, for college graduates or for hgh school dropouts). Indcators are therefore created for the presence of specfc groups n the studes whether the effect sze s obtaned for each specfc target group. The coeffcents of the

27 A Meta-Analyss of the Effect of Educaton on Socal Captal 17 specfc group varables represent the varatons n the study estmates caused by group dfferences, condtonal on these groups beng observed. Important nformaton wll be ncluded n ths lnear model on whether ndvdual studes have consdered educaton endogenety, the relatve effect of educaton, and recprocty mechansms wthn dmensons of socal captal. Here also added to the extended model are ndcators on whether the ndvdual study has controlled for economc status (ncome and employment status), envronment (populaton densty, resdency length, and development ndex), relgon, meda nfluence (televson or Internet). Table 2.4 presents the results of the extended model obtaned from the STATA meta-analyss package 1. There s a statstcally sgnfcant mpact of controls for envronment and controls for recprocty for both socal trust and socal partcpaton. Controls for relgon, famly (famly sze or martal status), meda nfluence (rado, TV and Internet) appear to have an effect on the varaton n study estmates of ndvdual socal trust, but no sgnfcant nfluence on ndvdual socal partcpaton. Controls for economc status, educaton endogenety, and average educaton level n the target regon only have an nfluence on the varaton n study estmates of socal partcpaton. Some study features, such as gender and age controls, have no statstcally sgnfcant nfluence on the estmated return to schoolng. The nfluence of lteracy controls cannot be neglected. The lteracy controls reduce the effect of schoolng on socal partcpaton by a consderable degree. 1 I use metareg from STATA to perform random effects meta-analyss.

28 18 Chapter 2 Table 2.4 Extended model for random effects meta-analyss Socal Trust Socal Partcpaton Varable control n study Coef. z-value Coef. z-value Gender control Famly control 0.015** Recprocty mechansm control ** ** Envronment control ** *** 4.76 Relgon control 0.017*** Age/cohort control Meda control ** Educaton endogenety control *** Average educaton control *** 3.46 Lteracy control *** Specfc groups n study Coef. z-value Coef. z-value Female *** Survey after *** College graduate 0.010** *** 3.94 Older age group (over 60=1) ** 1.97 Non-US survey *** *** Partcpaton n voluntary actvty Constant 0.051*** *** τ N Notes: **Sgnfcant at the 5 percent level. ***Sgnfcant at the 1 percent level. When t comes to specfc target groups, there s a declne n the estmates from socal partcpaton studes for women and for the perod after The effect szes do not seem to vary for these groups n socal trust studes. Educatonal attanment s an mportant factor for the varaton n the effect szes of the return to an addtonal year of schoolng. People wth at least a college degree receve a notably hgher return to a margnal year of educaton. No systematc varaton s found for the stages across the lfe cycle, and nor s any substantal dfference observed between membershp of socal groups and partcpaton level n voluntary actvtes, the two sub-categores of ndvdual socal partcpaton. There s a sgnfcant dstncton n the effects of educaton between the Unted States and other countres. The fndngs suggest that the hgher return to educaton s one reason why Amercan people tend to have more socal captal

29 A Meta-Analyss of the Effect of Educaton on Socal Captal Publcaton bas, test and correcton Publcaton bas s an mportant aspect related to the qualty of the research synthess. It arses n a meta-analyss when the probablty that an estmate s observed s related to the statstcal sze of the estmate. Such selecton effects can produce a substantal bas n the effect szes. Egger s test s a common approach to test for the presence of publcaton bas. Egger et al. (1997) suggest performng a regresson of the standardzed effect sze aganst ts precson (.e. the nverse of effect sze s standard error), weghted by the recprocal of the varance of the estmate. If the ntercept dffers sgnfcantly from zero, ths may ndcate that publcaton bas s present. The Egger s test statstcs presented n Table 2.5 ndcate that there s a severe bas n the meta-analyss of both socal trust and socal partcpaton. The Egger s bas coeffcents, (p-value<0.001) n socal trust studes and (p-value=0.005) n socal partcpaton studes, strongly ndcate the presence of asymmetry and publcaton bas. Table 2.5 Egger s test statstcs for publcaton bas Socal Trust Socal Partcpaton Std. Effect sze Coef s.e t-value p> t Coef s.e t-value p> t Slope Bas (ntercept) N Note: The slope and bas n the Egger s test s not the slope and ntercept of the ftted value lne. Begg s adjusted rank correlaton test (Begg and Mazumdar, 1994) s an alternatve approach to check for publcaton bas, by determnng f there s a sgnfcant correlaton between the effect szes and ther varances. In order to construct a vald rank correlaton test, t s necessary to stablze the varances by standardzng the effect szes pror to performng the test. Plots are also presented wth a predcted value lne of the effect szes aganst ther standard error as a straghtforward nterpretaton of publcaton bas. In the absence of any selectve reportng, the lne of ftted values n the scatter plot should be horzontal, as the estmates of the return to schoolng should not vary n proporton to ther standard error. The statstcs of Begg s adjusted rank correlaton test are presented n Table 2.6, followed