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Edited by Geraint Johnes, Jill Johnes, Tommaso Agasisti and Laura López-Torres

This Handbook provides a comprehensive overview of the modern economics of education literature, bringing together a series of original contributions by globally renowned experts in their fields. Covering a wide variety of topics, each chapter assesses the most recent research with an emphasis on skills, evaluation and data analytics.
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Edited by Geraint Johnes, Jill Johnes, Tommaso Agasisti and Laura López-Torres

mitigated by policy. For example, smoothing the transition of students as they move from one level of education to another, and providing smart reporting on truancy can both help reduce the incidence of dropout. Some other factors – in particular neighbourhood characteristics – are more impervious to policy, but are nonetheless 1   Johnes, G. and J. Johnes (eds) (2004). International Handbook on the Economics of Education, Cheltenham: Edward Elgar. ix JohneS 9781785369063 print.indd 9 17/11/2017 14:28 x   Handbook of contemporary education economics important and

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Henry M. Levin and Clive R. Belfield

of alternatives that have common goals such as improving achievement in a particular subject and using similar measures of outcome. It cannot be used to compare effectiveness in reaching different goals. It was initially developed to compare the cost and effectiveness of different weapon systems for the military (Hitch and McKean, 1960), but soon was applied to civilian purposes including education (Levin, 1970, 1975) and even a longer history in applications to health 338 JohneS 9781785369063 print.indd 338 17/11/2017 14:29 Cost-effectiveness and educational

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Ilja Cornelisz

’, ‘stratification’, ‘segregation’). Next, studies were chosen on the basis of their appropriateness (for example, OECD countries) and assigned to either the theoretical- or empirical section, or both. 289 JohneS 9781785369063 print.indd 289 17/11/2017 14:29 290   Handbook of contemporary education economics A FRAMEWORK FOR EVALUATING SCHOOL CHOICE The definition of schooling can be any form of education ranging from public schooling, private-religious schooling, private-independent schooling, to even home schooling (Belfield, 2004). Several policies and mechanisms contribute

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Junyan Liu and Mark Bray

meet their needs. Cultural influences are also evident. For example, Confucian values of diligence and belief in merit are commonly mentioned in East Asia (Kim and Lee, 2010; Kwok, 2010; Zhang, 2014). Success in education is considered vital for success in social status, 398 JohneS 9781785369063 print.indd 398 17/11/2017 14:29 Understanding shadow education from the perspective of economics of education   399 Table 18.1  Cross-national indicators of shadow education Location Patterns Argentina Cámara and Gertel (2016. p.140) surveyed 360 students who had gained

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Daniel Santín and Gabriela Sicilia

comments and suggestions. We are also grateful to Tommaso Agasisti, Juan Aparicio, Geraint Johnes and Mika Kortelainen for helpful discussions. 1   This ‘ideal for analysis’ education system would be equivalent to allocating students, teachers and principals to schools by holding a big lottery at the age of school entry. This unrealistic strategy is based on the idea that randomisation only creates small non-significant differences in unobserved variables. Of course, school choice in the real world is far away from this system. 211 JohneS 9781785369063 print.indd 211

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Patrice Iatarola and Leanna Stiefel

HISTORY OF POLICIES ON HIGH SCHOOL SIZE A.  The Large High School Movement In the late 1950s James Conant, former President of Harvard University, undertook a study of the American high school at the bequest of the Carnegie Corporation of New 1   While school size reforms have been used in other countries, none has been similar to the scale and scope of the reforms in the U.S. Most of the empirical evidence on the effectiveness of school size reforms is from the U.S. context (Leithwood and Jantzi, 2007). 272 JohneS 9781785369063 print.indd 272 17/11/2017 14

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Jack Britton and Anna Vignoles

literature was conducted by Haveman and Wolfe (1995) who highlighted many of the methodologi1   See Heckman and Kautz (2012) and Borghans et al. (2008) for discussion of the importance of noncognitive skills. 246 JohneS 9781785369063 print.indd 246 17/11/2017 14:29 Education production functions   247 cal challenges that researchers have faced along the way, and in particular the difficulty of establishing causal relationships between resource inputs and educational outcomes. Since then, the education production function has been adapted to take account of some of

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Sofie Josefina Cabus

dropout determinants published before 2010 for advanced economies; and Glewwe and Muralidharan, 2015 for developing countries. 1 2 43 JohneS 9781785369063 print.indd 43 17/11/2017 14:28 44   Handbook of contemporary education economics Albeit the large set of studies on school dropout determinants, there is still much unknown in the academic literature on the most effective approach for keeping students in school in order to lead them towards a high school diploma. This is mainly because research on the most effective way to tackle early school leaving was (is

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Nicholas Barr

  I am grateful to the editors and to Michael Otsuka, Andrew Norton and Gill Wyness for helpful comments. Remaining errors are my responsibility. 2   Professor of Public Economics, London School of Economics; n.barr@lse.ac.uk; http://econ.lse.ac.uk/ staff/nb. 357 JohneS 9781785369063 print.indd 357 17/11/2017 14:29 358   Handbook of contemporary education economics Box 16.1  Subsidising external benefits: The exception Though the argument in the previous paragraph is generally correct, it does not hold where demand is price inelastic, that is, where the number