Education and Long Term Social Mobility in Benin

Résumé

This paper uses a unique data set from the first regional schools in colonial Benin to document and measure intergenerational mobility and its effect on risk aversion, work ethics, mental health and life outlook. The study covers the first generation of students and their unschooled counterparts following the establishment of colonial and missionary schools as well as their descendants for the following two generations. We find evidence of upward mobility across generations on education. However, the evidence suggests that the second generation moved up and third generation moved down from their parents’ income levels. This points to a decline in the returns to human capital from the second to the third generation. A possible explanation for this result is the dominance of formal sector employment by the public sector: in our data, 67% of the third generation respondents with at least a high school education are low-wage civil servants and only 3% are entrepreneurs. We also find that downward mobility is associated with more risk aversion, and weaker work ethics and more negative life outlook. We provide evidence for causality by exploiting the plausibly exogenous variation in education treatments in colonial Benin (Wantchekon et al., QJE 2015) and using assignment of education to grandparents to instrument for mobility. Overall, the paper provides a family-centric framework for the study of economic development and documents social mobility’s effects on the behavioral capacity of individuals. joint with TSE Development