Dear Statalisters,
I want to measure the causal impact of parent's education on children's education and the problem is that parent's education is likely endogenous (parent's education is correlated with parent's genes and both of them influence children's education). In previous studies three strategies have been used: data on adoptees, data on twin couples, IV strategy. I think that IV is best to solve endogeneity but it only measure the Local Average Treatment Effect, for example some studies use a school reform as instrument but then you only measure the impact on those whose parent's education would have been different without the reform. I wanted an instrument that affect the schooling of all parents. My idea is to use grandparents education as instrument. Relevance for the instrument is quite trivial. In order to assure that the instrument satisfy the exclusion restriction I would use a dataset where the parents have been adopted as children, so that there is no correlation between the genes of the grandparents and the genes of the nephews.
Do you think that this strategy could work?
Thanks a lot
I want to measure the causal impact of parent's education on children's education and the problem is that parent's education is likely endogenous (parent's education is correlated with parent's genes and both of them influence children's education). In previous studies three strategies have been used: data on adoptees, data on twin couples, IV strategy. I think that IV is best to solve endogeneity but it only measure the Local Average Treatment Effect, for example some studies use a school reform as instrument but then you only measure the impact on those whose parent's education would have been different without the reform. I wanted an instrument that affect the schooling of all parents. My idea is to use grandparents education as instrument. Relevance for the instrument is quite trivial. In order to assure that the instrument satisfy the exclusion restriction I would use a dataset where the parents have been adopted as children, so that there is no correlation between the genes of the grandparents and the genes of the nephews.
Do you think that this strategy could work?
Thanks a lot
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