Another Thought on Martorell and Clark
M&C have the best data set ever constructed for detecting ability
bias. After all, they’ve got measures of years of education, earnings,
and initial test scores – i.e. test scores before high school has had much time to work its cognitive magic (if any).
upshot: I’d really like to see M&C write another paper where they
simply estimate the return to education with and without the initial
test score as a control. Indeed, I’d consider this a more credible lower bound on ability bias than the whole IV literature has managed to produce.
A further thought: M&C know the exact testing dates. So they could actually estimate earnings as a function of initial test score and continuously measured subsequent educational attainment. Anyone want to bet on how much this will slash a naive estimate of private return to education?