Revisiting the returns to education during rapid structural and rural transformation in Thailand: A regression discontinuity approach

Abstract

This paper estimates returns to schooling in Thailand, applying a regression discontinuity approach to the change in the compulsory schooling law in 1978. This law helped to enhance human capital investment on the eve of rapid structural transformation. The returns to schooling based on our instrumental variables estimation were around eight per cent, while ordinary least squares (OLS) overestimated such returns. Returns were higher in urban areas, service sectors, and underdeveloped northern regions.