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Research ArticleArticles

Birth Cohort Size Variation and the Estimation of Class Size Effects

View ORCID ProfileMaximilian Bach and Stephan Sievert
Journal of Human Resources, March 2025, 60 (2) 578-606; DOI: https://doi.org/10.3368/jhr.0919-10430R2
Maximilian Bach
Maximilian Bach works at the Federal Statistical Office of Germany (corresponding author, . He was a researcher in the Department of Labour Markets and Social Insurance at ZEW Mannheim when this paper was written. Part of this paper were written while he was a Ph.D. student at the Graduate Center DIW and Humboldt University Berlin.
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Stephan Sievert
Stephan Sievert works at the Federal Ministry of Labour and Social Affairs. He was a guest researcher at DIW Berlin when this paper was written.
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Abstract

We show that in school systems with grade retention or redshirting birth cohort size is negatively related to the grade-level share of students who are too old for their grade. This compositional effect gives rise to an upward bias in estimates of class size effects based on commonly used research designs exploiting within-school variation in birth cohort size. Using data for all primary schools in one federal state of Germany, we find support for this compositional effect. Correcting for the resulting bias, we find that not only are smaller classes beneficial for test scores, but also for reducing grade repetitions.

JEL Classification:
  • I20
  • I21
  • I29
  • Received September 2019.
  • Accepted June 2022.
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Journal of Human Resources: 60 (2)
Journal of Human Resources
Vol. 60, Issue 2
1 Mar 2025
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Birth Cohort Size Variation and the Estimation of Class Size Effects
Maximilian Bach, Stephan Sievert
Journal of Human Resources Mar 2025, 60 (2) 578-606; DOI: 10.3368/jhr.0919-10430R2

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Birth Cohort Size Variation and the Estimation of Class Size Effects
Maximilian Bach, Stephan Sievert
Journal of Human Resources Mar 2025, 60 (2) 578-606; DOI: 10.3368/jhr.0919-10430R2
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  • Article
    • Abstract
    • I. Introduction
    • II. Common Approaches to Study Class Size Effects
    • III. The Spurious Relationship between Birth Cohort Size and Students’ Skills at the Grade Level
    • IV. Institutional Context
    • V. Testing the Theoretical Predictions
    • VI. Data
    • VII. Estimation Strategy
    • VIII. Class Size Effects
    • IX. Conclusion
    • Acknowledgments
    • Footnotes
    • References
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Keywords

  • I20
  • I21
  • I29
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