In every society for which we have data, people's educational achievement is positively correlated with their parents' education or with other indicators of their parents' socio-economic status. This topic is central in social science, and there is no doubt that research has intensified during...

The decision to take more education is complex, and is influenced by individual ability, financial constraints, family background, preferences, etc. Such factors, normally unobserved by the researcher, introduce endogeneity and heterogeneity problems into estimating the returns to education. In...