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To what extent does a higher income for parents mean that their children will also have a higher income in later life? And how does additional school funding affect the performance of children? Professor Monique de Haan’s research uncovers mechanisms, patterns and causal relationships within education, labour and family economics.

De Haan obtained her bachelor’s and master’s degrees in economics at the Amsterdam School of Economics (ASE) and obtained her PhD there in 2008. After a postdoc period, she was lured by the call of international academic research. 'One of my co-authors was already working in Oslo. So, to me, it was a natural place to continue our collaboration,' she says. In the end, she spent 9 years as an Associate Professor at the University of Oslo before returning to her alma mater.

In September 2021, she took up a position as Professor of Empirical Microeconomics at ASE. Although she partly worked from home for the first few months because of COVID-19 measures, De Haan immediately settled in. ‘It’s a really pleasant research group. We often have lunch together and everyone sits at the same table here, PhD students and professors alike. That also gives us a chance to discuss things like recent seminars.’

If being on benefits means that your children will end up applying for benefits as well, then policy-makers should act on it.

Insight into the existence and scope of causal effects

De Haan acknowledges that empirical microeconomics is a broad concept. She focuses on answering questions about causation in the domains of education, the labour market and income distribution. ‘I try to use administrative data sets and data sets derived from questionnaires to address the issue of causation. I do this with as few assumptions as possible.’

As an example, a social issue of some relevance is whether the children of benefit recipients will also come to depend on benefits in later life. There is a strong correlation but the question is why. 'It could be explained by shared characteristics such as poor health or a lower level of education. These characteristics ensure that both parents and their children end up on benefits more often,' the economist explains.

And the mere fact that you claim a benefit can increase the chance that your children go on to apply for a benefit as well. One reason is that parents who are on welfare feel less connected with the labour market. So they are less able to help their children get on the job ladder,' De Haan argues. 'I investigate the correlation between parents and children who apply for a benefit. To what extent is the correlation causal? And to what degree can this be explained by the similarity of characteristics between parents and children?'

Matching and lotteries in secondary education

Other research by De Haan focusses on the system of matching and lotteries for schoolchildren in Amsterdam. She is examining the costs and benefits of the various placement systems. ‘Until 2013, schools in Amsterdam used the Boston mechanism. In the first round, students applied to 1 secondary school. If the school was oversubscribed, then a lottery was conducted. If you failed to get a place, you could then only choose from schools that were undersubscribed. This motivated parents and children to choose strategically, using the probability of getting a place rather than preference, for example.’  

This was not without consequences. Students were often unable to make the best strategic decision. As De Haan observes: ‘Many of these students would have been better off if they had actually applied to their first-choice school.’

A better alternative to the Boston mechanism turned out to be matching via Deferred Acceptance (DA). 'This requires children to submit a preference list with several secondary schools. In this system, there is no incentive for strategic behaviour.'

Studies showed that the old placement system was particularly disadvantageous to specific groups of students such as children with lower grades on their Cito exam (a final-year assessment for primary school pupils) and those from lower-income neighbourhoods. In the end, schools in Amsterdam abandoned the Boston mechanism in 2014 and started using the DA placement system.

Social impact

The issues examined by De Haan shed light on the existence and scope of causal effects. And this in turn affects the development of social policy measures. ‘If being on benefits means that your children will end up applying for benefits as well, then policy-makers should act on it. It might, for instance, be a reason for them to change the set-up of a benefit system,’ the professor points out. ‘Or the government could formulate additional policy measures for such children so they can get their first job more easily.’

Alongside her research, De Haan supervises PhD students and lectures in 2 subjects at ASE. ‘I teach both bachelor’s and master’s students in the Applied Financial Econometrics and Econometrics Analysis modules (PPLE). The material covers econometric methods, with a focus on their application. I show how students can use these methods to answer specific questions.'