Stevenson (2010) estimates the effect of participating in high school sports on adult wages using samples drawn from the 1979 Longitudinal Survey of Youth (NLSY). NLSY randomly selected teenagers and young adults in 1979 and surveyed them annually until 1994 when they were adults. Stevenson argues that economists need to estimate (1)

How does Stevenson conceptually define conventional and unconventional ability? Stevenson’s category of “unconventional skills,” are “less easily measured” than conventional academic abilities, and include attributes such as “the ability to communicate, the ability to work well with others, competitiveness, assertiveness, and discipline” (Stevenson, 2010, p. 286). (1)

(2) (3) (1)

(2) (3) (1)

(2) (3) (1)

Explain the difference in the two estimates using the concept of an omitted variable. (+) (2) (3) (1) (+)

What Stevenson wants to do is take high school girls who prior to Title IX would have been doing something other than sports, e.g., watching television, games, reading books, or talking with their friends, and randomly assign them to either not play sports or play sports. She can’t truly randomly assign girls but she can do something akin to it. What does she find that is akin to random assignment. Population of high school girls who prior to Title IX were not doing sports Treatment Group: Play Sports Control Group: Don’t Play Sports Stevenson (2010) exploits the variation in the participation of high school boys across states prior to Title IX to estimate the effect of playing sports on the educational and labor market outcomes of women. It is a natural experiment because girls are more likely to play sports in some states than others and the choice of where to live is sort of random, i.e., parents are not likely to move to a state because girls are more likely to play sports there.

Stevenson (2010) presents persuasive evidence that Title IX increased the number of years of education acquired by women. Since people with more education earn higher wages, on average, we would expect that Title IX would have increased the wages of women. But, it also increased the supply of people with more education, potentially leading to a decrease in the wages. Stevenson summarizes this “difficulty,” saying that “generated a large labor supply shock, which may mitigate against any human capital gain that might increase wages (p. 297).