Another year in school will pay

21st April 2006 at 01:00
Research on thousands of twins reveals staying in education significantly improves earning power, Michael Shaw reports

The impact that education has on young people's futures is increasingly important, according to a study which examined the fortunes of twins.

The joint research by Warwick and Southern Denmark universities, partly funded by the British government, suggests that the world is becoming more meritocratic. The researchers examined 20 years of data on more than 30,000 pairs of twins in Denmark, a third of whom were identical.

They found that, up to 15 years ago, there was almost no difference between the twins' earnings if one stayed on for an extra year in education. But the gains of staying in school or college have grown. An identical twin who remains in education for a year longer than their sibling will now earn 8 per cent more when they get a job.

The earnings of non-identical twins are also greater if they stay on in education, with female siblings earning 9 per cent more and male siblings 11 per cent.

Ian Walker, professor of economics at Warwick university, said that the findings from identical twins were the most interesting as they had fewer differences than non-identical twins, making the impact of education on their careers clearer. "We wanted to know why inequality was rising around the world - why the rich were getting richer," he said. "In the past, differences in earning could have been to do with an innate ability to make money, or some other unobservable attribute, but this shows that education has a bigger effect.

"There are very few investments you could make which would have such a financial return as the one you get from staying an extra year in education."

Professor Walker said it had been necessary to carry out the research in Denmark rather than Britain because the Danish government had significantly more detailed records of its citizens, and data protection rules in the UK would have made it impossible to draw much of the information together. The study was due to be presented yesterday at the Royal Economic Society's annual conference at Nottingham university.

primary Forum 23 Twin-based Estimates of the Returns to Education is at

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