Institute for Research on Labor and Employment

We establish that the birth year in China is related to educational attainment because of the superstitious believes that the girls who were born in the “sheep” year will suffer bad luck, and the education system. The crude birth rate declined in the “sheep” year and schools response to the fluctuations by class size in the short run because there were no binding constraints on the class size in China. We estimate the return to education by using birth year as an instrument for schooling.