The Impact of Compulsory Schooling Expansion on Educational Outcomes: The Case of Indonesia

Abstract

Compulsory schooling reforms have been frequently used for expanding access to higher levels of education. However, these laws may not translate immediately into human capital gains. In this paper, we assess the impact of compulsory schooling expansion in Indonesia on a set of educational outcomes. The identification strategy exploits the discontinuity in the exposure to the reform according to individual's month and year of birth adopting a sharp regression discontinuity design. Our main results indicate that the reform successfully increased expected years of education and the probability of completing junior secondary education in the middle and long term. The reform also shaped the propensity to enroll and complete senior secondary schooling. However, the policy did not affect university attendance. Upon closer examination of heterogeneous effects, we found that the reform's impact was more substantial on individuals living in urban compared to those living in rural areas across both Java and Non-Java Islands. Moreover, when we investigate the heterogenous effects of parental education along with the gender of the child, male children with a low parental education experienced a greater effect from the reform. In contrast, female children of highly educated parents were more affected by the reform.