Sibling Rivalry: Evidence from China’s Compulsory Schooling Reform

Abstract

Abstract This study investigates the causal effect of older siblings’ schooling on their younger siblings’ schooling and labor market outcomes by exploiting the temporal and geographical variations in the implementation of compulsory schooling laws in China. Reform exposure is quantified as the number of years that an individual is eligible for compulsory education. We find that older siblings’ exposure to compulsory schooling reform had negative impacts on their younger siblings’ academic achievement and labor market performance. We provide some suggestive evidence for the mechanism of resource reallocation within households. These findings suggest that we may be overestimating the social benefits of compulsory schooling reforms by ignoring the resources constraints within households and the spillover effects on siblings.