Lifetime Consequences of Lost Instructional Time in the Classroom: Evidence from Shortened School Years

This study estimates the lifetime effects of lost instructional time in the classroom on labor market performance. For identification, I use historical shifts in the school year schedule in Germany, which substantially shortened the duration of the affected school years with no adjustments in the core curriculum. The lost in-school instruction was mainly compensated for by assigning additional homework. Applying a difference-in-differences design to social security records, I find adverse effects of the policy on earnings and employment over nearly the entire occupational career. Unfavorable impacts on human capital are a plausible mechanism behind the deteriorated labor market outcomes. The earnings losses are driven by men, for whom the policy also elevated income inequality due to larger harm occurring at the bottom of the income distribution.