The aim of the present paper is to gain some insight into the causes of dropping out of school and, more generally, of the factors that induce parents to review their choices about their child’s schooling careers. To this end we apply to data from a school dropout survey insights from a model of sequential decision making by parents, where the initial decision can be reviewed in the light of new information emerging about the ability and opportunities of the child in benefitting from education relative to her alternative (in the unskilled labour market). Analysis of the data confirms that both the economic capacity (opportunity costs) and the cultural capacity (ability to disentangle signals about future opportunities) of the family of origin shape observed choices about drop-out and return to school by individuals in our sample. Dropping out behavior also appears to be strongly influenced by mismatches between school and student, however, and many of those who leave are not “gone for good.”
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