What one does not know, in the form of unobserved heterogeneity, can mislead one in empirical estimates. A simple model of intrahousehold allocations illustrates the possible importance of unobserved factors such as abilities in determining human resources and their impacts. The author reviews...

We use the Swedish compulsory school reform to estimate the causal effect of parental education on sons' outcomes. To this end, we use data from the Swedish military enlistment register on the entire population of males and consider outcomes, such as cognitive skills, noncognitive skills, and...