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Fanny LANDAUD (Norwegian School of Economics (NHH)), “Getting Lucky: The Effect of Luck on High School Exit Exams “
The Macroeconomics Seminar:
Time: 12:15 pm – 13:30 pm
Date: 26th of November 2021
Room : 1001
Fanny LANDAUD (Norwegian School of Economics (NHH)), “Getting Lucky: The Effect of Luck on High School Exit Exams”
Abstract : This paper studies the role of luck in economic success. We leverage unique features of the Norwegian education system that produces random variations in the content of the high school exit exams taken by students. Lucky students are asked to take exams in the subjects they are most comfortable with, and we show that this generates very significant improvements in both their GPA and diploma probability. We further show that exam luck generates substantial and persistent wage differentials across otherwise identical individuals, and these luck induced wage differentials are of a similar magnitude as those generated by well-known education inputs, such as teacher quality. We also provide evidence that exam luck impacts students’ labor market outcomes mainly through increases in their GPA and ensuing improvements in their higher education outcomes; by contrast, luck induced increases in diploma probability have little long-term consequences.
Grégory CORCOS (Polytechnique-CREST), Arne UHLENDORFF (CREST)