Essays on School Resources, Academic Achievement and Student Employment

Abstract: Essay 1 (with Tanja Kirjavainen and Roope Uusitalo) analyzes the effects of changes in school spending on changes in student performance. We use a large sample of matriculation examination scores of Finnish senior secondary school students from the years 1990–1998. We estimate fixed-effect panel data models that use the dramatic changes in the school spending caused by the 1990s' recession as identifying variation. According to the results, changes in teaching expenditure did not have a significant effect on the test scores. The grade point average in comprehensive school and the parents’ education are the strongest explanatory variables for student achievement.Essay 2 examines which factors predict academic performance at university and compares the predictive values of subject-related entrance exams and indicators of past school performance. The results show that a large fraction of students would be admitted whether the admission was based on entrance exams, past performance or a combination of these, which is the current system. In the fields of engineering, social sciences and sport sciences entrance exams predict both graduation and the number of study credits after four years better than past school performance. In education past school performance is a better predictor of graduation. Changing the admission rule to school grades would affect the average student performance negatively in engineering and social sciences but positively in education. Using only entrance exams would not signifi-cantly change the average student performance in any field.Essay 3 (with Roope Uusitalo) evaluates the changes in the times-to-degree at the Finnish universities in the 1990s. In particular, the study evaluates the effect of the 1992 student aid reform that was intended to shorten the duration of university studies. We find that the student aid reform had only a modest effect, and that this effect was limited to the fields with long median durations. Most of the decline in the observed times-to-degree can be explained by an increase in the unemployment rate that reduced student employment opportunities.Essay 4 examines how university students' employment decisions affect their labor market success after graduation. The study is based on individual level panel data of Finnish university students from the years 1987–1998. The OLS estimates show that in-school work experience is associated with higher earnings and employment after graduation. Local unemployment rate during enrollment is used as an instrument for endogenous work experience acquisition. Comparing graduates with equal times-to-degree, the IV estimates show that work experience increases earnings considerably one year after graduation. The effect is smaller and statistically insignificant in later years. Taking into account that working usually leads to longer times-to-degree, IV estimates show no significant returns to student employment.