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Getting Lucky: The Long-Term Consequences of Exam Luck

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  • Fanny Landaud

    (THEMA - Théorie économique, modélisation et applications - CNRS - Centre National de la Recherche Scientifique - CY - CY Cergy Paris Université, CNRS - Centre National de la Recherche Scientifique)

  • Eric Maurin
  • Barton Willage
  • Alexander Willén

Abstract

This paper studies the impact of exam luck on individuals’ education and labor market success. We leverage unique features of the Norwegian education system that produce random variation in the content of the exams taken by students at the end of high school. Lucky students take exams in subjects they are better at, and we show that this generates significant improvements in both their high school GPA and diploma probability. Subsequently, exam luck generates substantial and persistent wage differentials across otherwise identical individuals. These luck-induced wage effects are of a similar magnitude as those generated by well-known education inputs, such as parental education and teacher quality.
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Suggested Citation

  • Fanny Landaud & Eric Maurin & Barton Willage & Alexander Willén, 2023. "Getting Lucky: The Long-Term Consequences of Exam Luck," Working Papers hal-04322121, HAL.
    • Handle: RePEc:hal:wpaper:hal-04322121
    DOI: 10.2139/ssrn.4036986
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    Cited by:

    1. Graetz, Georg, 2023. "Imperfect signals," Working Paper Series 2023:10, IFAU - Institute for Evaluation of Labour Market and Education Policy.

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    More about this item

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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