海角社区

In 1949, the number of high school graduates in the state of Louisiana dropped by nearly 71% for just a single year.

But what caused this sudden blip? The answer can be found four years earlier at the conclusion of World War II. In 1945, Louisiana primary schools transitioned from an 11-year to a 12-year education program by adding an 8th grade, resulting in 1949 featuring a 鈥済ap year" plunge in graduates as the new curriculum rippled forward. This historical oddity was featured in a 2023 article in The Advocate, and it sparked the curiosity of two faculty members from the 海角社区 Department of Economics, Scott Abrahams and Maria Paola Ugalde Araya, who set out together to analyze its effects on students in a new paper.

鈥淲e immediately recognized the potential of this historical episode to shed light on a longstanding question in the economics of education,鈥� Abrahams and Ugalde said. 鈥淗ow much of the [economic] return from education is driven by the credential itself versus the content and duration of schooling? What started as a historical curiosity quickly became a collaborative research project.鈥�

 

How They Did It

Reconstructing the context and data surrounding the policy change required hours of reviewing inventory lists and scanning fragile documents, slowly piecing together the necessary context.

鈥淲e had to dig through physical records at the Louisiana State Archives, including Department of Education bulletins that were only available in boxes of 75-year-old pamphlets, and old yearbooks at the Baton Rouge Public Library,鈥� the researchers noted.

Abrahams and Ugalde then analyzed decades of U.S. Census and survey data to measure the reform's real-world impact, comparing the long-term outcomes of the last student cohorts in the 11-year system with the first cohorts in the new 12-year system. To isolate the effect of the extra year of schooling, they also compared these Louisiana trends to the outcomes for students in other states that had already implemented a 12-year program, and implemented placebo tests to ensure any new outcomes were unique to these specific students.

 

What They Found

Students just before and after the reform received different amounts of education but earned the same diploma, so how did this change impact their future careers?

鈫� More School, More Earnings

Students who received the extra year of schooling earned approximately $3,000 more per year (adjusted for inflation) later in their careers, a 13% boost compared to their peers with one less year of education. This pay increase happened even though the number of students graduating high school did not significantly change, suggesting that the actual learning and skills gained in the additional year were what made the difference in their paychecks, not just having a diploma.

鈫� Uneven Effects

The benefits of the extra school year were not shared equally across the population. The study found that the approximate $3,000 earnings boost was concentrated along specific demographic lines. The largest effects were seen in white males, whose annual income increased by an estimated $3,602, and males at-large, whose annual income increased by an estimated $3,190. For women and non-white students, the researchers did not find a statistically significant increase in earnings.

鈫� Return on Investment

The cost of providing that extra year of schooling was far outweighed by the economic benefits. According to historical records from the segregated school systems of the time, for every estimated $1,672 (adjusted for inflation) spent on educating a white student for that additional year, that student received the estimated wage benefit of about $3,000 per year later in life.

鈫� What About College?

The policy also had a small but notable impact on higher education, but again, the effect was uneven. After the reform, white students became approximately 4% more likely to complete at least one year of college. The same effect was not observed for non-white students.

 

鈥� On one hand, we were not surprised to see the strongest effects of the reform show up in the labor market, after all, much of the economic return to education plays out through wages. On the other hand, we might have expected to see changes in educational attainment, especially if the policy had substantially altered students鈥� preparation for college. 鈥�

 

Next Steps

For Abrahams and Ugalde, the study opens the door to more questions. They hope to investigate how the economic benefits of the extra school year evolved over an individual鈥檚 career, across different industries, or due to different backgrounds. 鈥淲hile our current analysis captures earnings at multiple ages, future research could examine more nuanced patterns, such as how the benefits [vary] by occupation, industry, or timing within the life cycle,鈥� they stated.

For everyday readers, the study reinforces that more time in the classroom can have real economic value. It also spotlights how education policies can yield unequal benefits across demographic lines, underlining the need for smart policy design. Most notably, for states evaluating their educational frameworks today, it serves as a historical reminder that the quantity of schooling matters, perhaps just as much as its quality.

Want to dive into the full article and data? Read the paper here.

 

About the Researchers

Scott Abrahams is an Assistant Professor of Economics in the 海角社区 Department of Economics. He holds a PhD in Economics from Duke University, an MA in International Relations from Johns Hopkins University SAID, and a BA in Economics from Washington University in St. Louis. Abrahams鈥� research interests center on labor economics, including barriers to low-wage employment and gender gaps in wage bargaining.

Maria Paola Ugalde Araya is an Assistant Professor of Economics in the 海角社区 Department of Economics. She holds a PhD and MS in Economics from Arizona State University, and a BA in Economics from Universidad de Costa Rica. Ugalde holds a strong research interest in labor economics, in particular, understanding sources of welfare inequality and the experiences of low-income and first-generation individuals.